last week, the Consumer Financial Protection Bureau uncovered a wide-spread crime spree at the employee level of Wells Fargo, discovering that thousands of employees had created fraudulent accounts so that they could reach sales goals and collect fees on customers.
Initially, the CFPB ordered Wells Fargo to pay full restitution to the injured customers, and Wells Fargo said that they would continue firing employees who took part in the fraud.
Now, though, the CFPB has extended their punishment of the bank and handed down their largest fine since the creation of the program in 2011. In addition to the damages paid out to customers, Wells Fargo is now being required to pay a whopping $100 million to CFPB.
We can be thankful that the CFPB is overseeing our financial organizations, working to keep them honest and protect the financial interests of the American people. Before 2011, there was no real way to keep an eye on institutions like Wells Fargo.
The CFPB was the brainchild of Massachusetts Senator Elizabeth Warren who established the organization as a watchdog for financial institutions in the wake of the 2008 crisis.
Now, the CFPB should take their investigation into Wells Fargo one step further and inquire into what sort of role the corporate offices played in their employees decision to defraud millions of their customers. No doubt, a great deal of corporate pressure and performance-based pay and employment played a massive role.
This investigation is not complete until the organization truly uncovers why Wells Fargo employees took such drastic action.