U.S. regulators have rejected Wells Fargo & Co.’s plan to repay customers who were pushed into unnecessary auto insurance, telling the bank it must do more to ensure it has found and compensated every affected driver, three sources familiar with the matter told Reuters.
Wells Fargo gave regulators the plan in June, as required by a $1 billion settlement the bank reached with the Consumer Financial Protection Bureau (CFPB) and the Office of the Comptroller of the Currency (OCC) in April.
After the review of the plan – it could involve the contact of some 600,000 riders – the OCC told Wells Fargo that the bank needed more confidence to find and pay back to everyone overcharged, and said the resources were not authorized to speak publicly about rejection.
The rejection is the latest wrinkle on Wells Fargo’s long-standing sales scandal, which announced in September 2016 that banks opened millions of accounts in customer names without affecting their aggressive sales targets.
Since then, Wells has announced that there are more customer breaches in businesses, including mortgage loans, asset management and auto loans here.
Representatives of Wells Fargo, the OCC and the CFPB refused to comment.
Drivers who purchase cars from Wells Fargo and allow them to be insured can be charged for sigort forced ın policies. Officials say about 2 million drivers are involved in these policies, and no more than a quarter of them are needed.
Customers who are charged for unnecessary insurance may face excessive charges, damaged credit or vehicle reimbursement. As part of the consensus agreement, Wells Fargo had to review several years of banking and insurance documents for these customers.
Although the sources provide details on the number of customers that Wells Fargo harmed regulatory agencies, which financial results they were exposed to, and how the bank was planning to compensate them, the OCC said it wanted to work behind the calculations before the plan was approved. The regulator also said that they want to make a statement about how employees perform their daily improvement tasks.
The OCC has no deadline to approve the plan, but Wells Fargo cannot finish its work completely away from the regulators.
Sources and former officials said that it is not uncommon for banks and regulators to put pressure on good pressure on an agreement, and that large banks tend to quickly meet regulatory demands after a major punishment.
Last year, Wells Fargo predicted that $ 64 million would be needed to repay customers, but lawyers representing drivers said the estimates were very low.
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