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Wells Fargo will be writing some big checks in a consumer protection case with all 50 states and the District of Columbia.
According to reports, the company will pay $575 million to settle complaints that the bank pressured its employees to create fake checking, credit card, and other accounts for customers without their knowledge. Investigators said the practice affected more than 3.5 million accounts.
The bank has already paid more than $600 million in restitution and $1 billion in fines. So long as the bank doesn't run out of checks, however, the worst may be over.
"Holds Wells Fargo Accountable"
Iowa Attorney General Tom Miller, one of the leading attorneys in the case, said the settlement agreement is one of the largest multistate settlements with a bank since the national mortgage settlement in 2012.
"This significant dollar amount, on top of actions by federal regulators, holds Wells Fargo accountable for its practices," he said in a statement.
Wells Fargo, in an announcement the same day, did not admit or deny the allegations. But it said the settlement covered all the complaints by the states.
The payments will be made to the states individually, with the largest settlement check for $148.7 million going to California. The District of Columbia, on the other end of the spectrum, will receive $1.1 million.
Worst May Be Over
After the announcement, Wells Fargo stock gained 1.3 percent. It appears the company had hit bottom and was due for a bounce.
Citing regulatory requirements that the bank make "significant improvements" in governance and oversight, Barrons reported that one analyst "thinks the worst is finally priced in."
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