By Sam Boughedda
The Consumer Financial Protection Bureau (CFPB) said Tuesday that it is ordering Wells Fargo (NYSE:WFC) to pay $3.7 billion for the "widespread mismanagement of auto Loans, mortgages, and deposit accounts."
The CFPB said Wells Fargo would be made to pay more than $2B in compensation to consumers and a $1.7B civil penalty for legal violations across several of its largest product lines.
They said the bank "repeatedly misapplied loan payments, wrongfully foreclosed on homes and illegally repossessed vehicles, incorrectly assessed fees and interest, charged surprise overdraft fees, along with other illegal activity affecting over 16 million consumer accounts."
"Under the terms of the order, Wells Fargo will pay redress to the over 16 million affected consumer accounts, and pay a $1.7 billion fine, which will go to the CFPB's Civil Penalty Fund, where it will be used to provide relief to victims of consumer financial law violations," the CFPB stated.
CFPB Director Rohit Chopra said: "Wells Fargo's rinse-repeat cycle of violating the law has harmed millions of American families."
"The CFPB is ordering Wells Fargo to refund billions of dollars to consumers across the country. This is an important initial step for accountability and long-term reform of this repeat offender."