The city of Los Angeles is suing Wells Fargo, alleging that in a push for profits the California-based bank opened customer accounts without their permission and then failed to refund fees for unwanted services, the city attorney's office announced Tuesday.
According to the complaint, Wells Fargo imposed unrealistic sales quotas that drove its employees to engage in unlawful activity, including opening fee-generating accounts without customers' permission.
"In its early response to our lawsuit, Wells apparently attributes the problem to rogue employees, but I want to point out that we allege that first whatever steps Wells took to deal with those employees were insufficient, and Wells, we allege, failed to notify customers that their data had been misused," L.A. City Attorney Mike Feuer told KPCC's AirTalk.
Wells Fargo faces possible fines of $2,500 for each violation, and the city is seeking an injunction to prohibit such practices moving forward.
In an emailed statement, the company responded:
"We will vigorously defend ourselves against these allegations. Wells Fargo’s culture is focused on the best interests of its customers and creating a supportive, caring and ethical environment for our team members. This includes training, audits and processes that work together to support our Vision & Values and our commitment to customers receiving only the products and services they need and will benefit from."
The city attorney's office said it is trying to identify victims' of the bank's alleged practice and urged customers to review their own accounts by asking the following questions:
- Have unauthorized savings and checking accounts been opened in your name?
- Have accounts you've closed stayed open?
- Have you received debit or credit cards you didn't request?
- Has a line of credit been opened that you didn't ask for?
- Have you been charged fees for any of these unauthorized activities?
Customers who find discrepancies in their accounts were urged to call a dedicated hotline at 213-978-3393.
This story has been updated.