Wells Fargo increases estimate for number of fake accounts to 3.5m

Helen Cahill
Follow Helen
Wells Fargo To Shed 500 Jobs In Mortgage Unit
The scandal erupted in September last year (Source: Getty)

Wells Fargo today increased its estimate for the number of fake accounts it held after a more comprehensive review of its sales practices.

The bank says it has found up to 3.5m potentially fake bank and credit card accounts; previously, Wells Fargo’s tally stood at 2.1m.

In September last year, it emerged that, between May 2011 and July 2015, accounts were opened at Wells Fargo without customers’ knowledge.

Read more: Wells Fargo profits remain flat as scandal continues to weigh on finances

Wells Fargo fired 5,300 employees, or around one per cent of its workforce, in relation to the scandal, and reached a $190m settlement with regulators over the matter.

John Stumpf, Wells Fargo’s chief executive, resigned about a month after the malpractice emerged.

The new estimate of the number of fake accounts set up follows a review by the bank dating back to 2009.

Of the fake bank accounts now discovered, around 190,000 have incurred fees and charges for the bank’s customers.

Wells Fargo said it will, therefore, return $2.8m extra in funds to customers, which comes on top of the $3.3m already refunded.

Read more: Wells Fargo settles $110m customer lawsuit

As part of the review, the firm also uncovered around 528,000 online bill pay enrolments that were potentially unauthorised.

Reimbursing these payments will leave Wells Fargo with a bill of $910,000.

“We apologise to everyone who was harmed by unacceptable sales practices that occurred in our retail bank,” said Tim Sloan, Wells Fargo’s chief executive.

“To rebuild trust and to build a better Wells Fargo, our first priority is to make things right for our customers, and the completion of this expanded third-party analysis is an important milestone.”