For more than a decade, US Bank pressured its employees to open fake accounts in their customers’ names in order to meet unrealistic sales goals, the Consumer Financial Protection Bureau said Thursday, in a case that is deeply similar to the sales practices scandal uncovered at Wells Fargo last decade.
NEW YORK — For more than a decade, US Bank pressured its employees to open fake accounts in their customers’ names in order to meet unrealistic sales goals, the Consumer Financial Protection Bureau said Thursday, in a case that is deeply similar to the sales practices scandal uncovered at Wells Fargo last decade.
The CFPB alleged that US Bank accessed consumers credit reports to open checking and savings accounts, credit cards and lines of credit without their permission. Employees were encouraged to do so, in order to meet the bank’s goals of selling multiple products to each customer with the bank.
The scale of US Banks’s fake accounts scandal was not disclosed immediately by the CFPB, but the bank was forced to pay $37.5 million in fines and penalties and will have to refund customers any fees they paid for the opened accounts.
“For over a decade, U.S. Bank knew its employees were taking advantage of its customers by misappropriating consumer data to create fictitious accounts,” said CFPB Director Rohit Chopra, in a statement.
A spokesman for US Bank, the fifth-largest bank in the country, did not immediately return a request for comment.
Wells Fargo’s sales practices scandal rocked the financial world roughly six years ago, when the bank was found to have encouraged employees to open millions of fake accounts to meet sales goals. The scandal ruined Wells Fargo’s reputation, led to billions of dollars worth of fines against the bank, and almost immediately led to the resignation of the bank’s CEO and eventually its board of directors.
Wells has been under tight supervision by the Federal Reserve since that scandal broke, keeping the bank from growing any bigger until it fixes its workplace culture.