Lessons From Wells Fargo: Protecting Your Bank Accounts

Protect Your Bank Accounts, Credit Cards From Unauthorized Use

Wells Fargo
(Image: iStock.com/AndreyPopov)
Wells Fargo
(Image: iStock.com/AndreyPopov)

Over the last several weeks, most people have heard about the settlements Wells Fargo made involving some of its customers receiving products or services that they did not want or request. Regulators hit Wells Fargo with $185 million in fines for creating millions of fake bank and credit card accounts from 2011—2015.

Wells Fargo workers reportedly opened up 1.5 million fake bank deposit accounts and issued debit cards with false pin numbers that may not have been authorized by consumers, according to the Consumer Financial Protection Bureau. They even created phony email addresses to enroll consumers in online banking services. What’s more, workers submitted more than 550,000 credit card applications without customers’ knowledge. Roughly 14,000 of those accounts incurred more than $400,000 in fees, including annual fees, interest charges, and overdraft protection fees.

More than 5,000 Wells Fargo employees were laid off and Chairman and CEO John Stumpf has stepped down (he retires with $134 million). So far, the bank has refunded $2.6 million to customers for fees associated with unwanted accounts. The average refund reportedly was $25. The impact of the unauthorized accounts on those customers’ credit scores is still unknown. Wells Fargo recently sent out a statement to its customer about how the financial institution is making amends.

Here’s What They’re Already Doing

Wells Fargo has eliminated product sales goals for its Retail Banking team members who serve customers in its bank branches and call centers. These sales targets and bonuses were apparently the motive behind the phony accounts.

Wells Fargo will send a confirmation after you open a new consumer or small business checking, savings, or credit card account so that you know what is happening and can notify the bank if anything confirmed is different than what you expected.

Wells Fargo is broadening its scope of work to find customers it may have missed. If there is any doubt about whether one of your accounts was authorized, and any fees were incurred, the bank will contact you and refund the fees.

Here’s What You Can Do

Have you found unauthorized bank or credit card accounts opened in your name by your bank? Or are you now terribly afraid of getting defrauded by your lender?

Call your financial institutions and ask to review a full list of all the accounts under your name. If any of them were opened without your consent, notify the bank.

Monitor your bank statements. Carefully look at bank fees and check for consistency to avoid unauthorized fees. Fees lost as part of the  fraudulent activities came out of legitimate accounts of victimized customers. Also, be aware that fraudulent charges often show up as “pending charges” for a period of time.

Review your credit reports thoroughly, looking for any unwanted or unfamiliar accounts. Should you find any fraudulent activity document it–note the account number, date, and any other pertinent information and alert the credit bureau.