Wells Fargo will pay $190 million to settle customer fraud case

But the reputational blow from claims of “widespread illegal” sales practices could prove costly. Two million unauthorized accounts may have been illegally created, the CFPB said, citing bank records.

Wells Fargo said 5,300 people have been fired over this, although that doesn’t appear to include senior management.

But this case, which regulators said involved pervasive misconduct involving thousands of bank employees, raised new questions about whether federal authorities have done enough to detect and punish bad behavior.

Now a middle school teacher, Bertrand said she believes the sales targets were set by managers who were higher up: “The sales pressure from management was unbearable”.

One Wells Fargo customer in California, Mr Shahriar Jabbari, had seven additional accounts that he did not consent to, according to a lawsuit he filed against the bank a year ago in federal court.

She said many banks have turned to account fees as a primary source of revenue from consumer banking since the recession, and that the incentives to find ways to charge fees go beyond Wells Fargo.

Even so, rivals already are moving to capitalize on the disclosures.

Wells Fargo will also fully refund customers for fees they were charged without fore-knowledge. The National Association of Federal Credit Unions, whose members, like community banks, compete with Wells Fargo, issued a similarly harsh denunciation.

“Banks are public institutions”. Executives were calling investors and analysts to try and tamp down fears over the impact, according to a person familiar with the matter.

Both Wells Fargo and First National have branches in North Platte.

Wells Fargo employees have sued the bank alleging they were forced to work unpaid overtime as they tried to meet goals, while bank customers have sued alleging that fake accounts were opened in their names.

An immediate worry for investors is how customers react to news of how employees behaved.

“Wells Fargo employees secretly opened unauthorized accounts to hit sales targets and receive bonuses”, said Richard Cordray, director of the Consumer Financial Protection Bureau, in a statement Thursday.

The scandal makes Wells Fargo into an “emblem of economic evil”, says Shiffer, at a time when the American people don’t trust leadership in most facets of society.

Some, like RBC’s Morford, expect Wells Fargo’s settlement will cause the industry to examine its cross-selling practices, to make sure they are focusing on what’s best for customers and less on quotas.

In the second quarter, however, the bank changed how it tallies up some of those numbers and said it was considering more changes.

Any erosion of that business could affect returns on equity at the bank.

“I was shocked because it’s such a good bank, it really is”.

“I think this is unique to Wells Fargo and their particular situation and how hard they push on cross-sell”, he said.

“We regret and take responsibility for any instances where customers may have received a product that they did not request”, Wells Fargo said in a statement.

“It was ingrained in the culture for a long time”, he said.