The Wells Fargo Bank has reached an agreement with the Office of the Attorney General of Washington and all 50 states to pay US $575 million as compensation for bad practices committed by the financial company.
“This agreement underscores our serious commitment to doing well in relation to past events as we work to build a better bank,” Wells Fargo President Tim Sloan said in a statement.
The agreed amount will be used to resolve civil lawsuits opened throughout the country, according to Wells Fargo, which indicated that it will continue to inform clients about the banking practices investigated.
Last October, New York Attorney General Barbara D. Underwood announced that Wells Fargo would pay a US $65 million fine after an investigation into the bank’s fraudulent statements to investors in relation to its “cross-selling” business model.
“The misconduct at Wells Fargo was widespread throughout the bank as well as in all levels of its management, which affected both the clients and the investors who were cheated,” Underwood said in a statement.
“Cross-selling” refers to the process of selling new products or financial services to an existing customer and Wells Fargo to increase revenues, applied “misconduct” driven by “strict and unrealistic sales goals.”
In April, the US regulatory authorities fined the bank US $1 billion dollars for negligence in their management of mortgages and car insurance, which was the biggest penalty to a financial institution imposed under the government of President Donald Trump.