Wells Fargo said in a securities filing the Justice Department and the Securities and Exchange Commission are now among the federal and state agencies investigating its sales practices.
The bank said Thursday it has lifted its reserve for litigation losses from $1 billion to $1.7 billion.
Employees at Wells Fargo opened about two million deposit and credit card accounts that customers didn’t authorize.
So far the bank has fired about 5,300 employees involved with the unauthorized accounts and has paid $185 million in fines.
Wells Fargo said Thursday it “has responded, and continues to respond, to requests from a number of the foregoing [enforcement agencies] seeking information regarding these sales practices and the circumstances of the settlements and related matters.”
CEO John Stumpf resigned last month after he was grilled during two appearances before Congress. He had been with the bank since 1982.
Wells Fargo is also under federal and state investigation for ‘certain mortgage related practices,’ it said Thursday.
* * *
Here’s the litigation disclosure about sales practices from Wells Fargo & Company’s Form 10-Q (pdf) filed with the SEC on November 3, 2016:
Federal, state and local government agencies, including the United States Department of Justice and the United States Securities and Exchange Commission, and state attorneys general and prosecutors’ offices, as well as Congressional committees, have undertaken formal or informal inquiries, investigations or examinations arising out of certain sales practices of the Company that were the subject of settlements with the Consumer Financial Protection Bureau, the Office of the Comptroller of the Currency and the Office of the Los Angeles City Attorney announced by the Company on September 8, 2016. The Company has responded, and continues to respond, to requests from a number of the foregoing seeking information regarding these sales practices and the circumstances of the settlements and related matters. A number of lawsuits have also been filed by non-governmental parties seeking damages or other remedies related to these sales practices.
Richard L. Cassin is the publisher and editor of the FCPA Blog.