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California Securities Lawyer Update: From Bad to Worse, Wells Fargo Increases Fake Account Estimate
By George C. Miller, Esq. of Shustak Reynolds & Partners, P.C. posted on Thursday, August 31, 2017.
George C. Miller
Partner
Location: San Diego, California
Phone: (619) 696-9500 (Ext. 105)
Direct: (619) 501-8270
Email: [email protected]
George C. Miller, Esq.
619.696.9500 ex. 105
[email protected]
Wells Fargo now estimates that the firm opened 3.5 million phony bank and credit card accounts from 2009 through September 2016, costing customers millions in account fees and related charges. This represents a more than a 60% increase over prior estimates, which did not factor the time period of 2009 through 2011. According to recent reports, Wells Fargo management was aware of the bank’s allegedly fraudulent sales practices as early as 2002.
In the fall of 2016, Wells Fargo paid approximately $185 million in regulatory fines for its allegedly fraudulent sales practices. The recent discovery of millions of new phony accounts could draw further attention and discipline from bank regulators. It remains to be seen whether regulators will examine the bank’s alleged misconduct occurring prior to 2009.
Wells Fargo’s CEO, Tim Sloan, called the new discovery “a reminder of the disappointment that we caused to our customers and stakeholders….” He apologized to “everyone who was harmed by unacceptable sales practices that occurred in our retail bank.”
In the wake of the banking scandal, Wells Fargo’s brokerage firm subsidiary, Wells Fargo Advisors, has seen significant attrition. In the first quarter of 2017 alone, over 200 financial advisors have reportedly left the firm.
Shustak Reynolds & Partners, P.C.’s experienced San Diego FINRA and securities attorneys are well versed in guiding financial advisors through transitions from one firm to another. Our FINRA arbitration practice group routinely represents financial advisors and registered representatives in employment and promissory note disputes before FINRA’s arbitration division. Contact us today for a confidential, complimentary consultation.
