Lawyers: Wells Fargo created about 3.5 million fake accounts

“The unauthorized account numbers reported in the filing are estimates made by plaintiffs’ attorneys based on a hypothetical scenario and have not been verified,” Pulido said. “The number of unauthorized accounts estimated in the filing do not reflect actual unauthorized accounts.”

Pulido declined further comment and said the bank has not disclosed its own revised estimate of how many unauthorized accounts were opened.

In September, Wells Fargo agreed to pay a combined $185 million fine to the federal Consumer Financial Protection Bureau and the federal Office of the Comptroller of the Currency and the Los Angeles city attorney.

San Francisco-based Wells Fargo has seen declines in new account openings and bank traffic and has been working to restore customers’ trust since the practices came to light.

The biggest scandal in the bank’s history led to the abrupt retirement of its CEO, John Stumpf. In response, Wells has changed its sales practices, ousted other executives and called tens of millions of customers to check on whether they truly opened the accounts.

The bank initially agreed to pay $110 million to settle claims dating back to 2009. But it agreed to add $32 million to the settlement to include claims starting in May 2002.

The new estimate was based on the expanded time frame and was included as part of the customers’ lawyers request that the judge approve the proposed settlement. A hearing is scheduled for next week.

After paying attorneys’ fees, the $142 million will first go to cover customers’ losses or fees that they may have incurred due to the unauthorized accounts. All remaining money will be split among the affected customers.

Shares of Wells Fargo fell 1.3 per cent and closed at $53.02 Thursday. Wells Fargo shares have dropped 3.8 per cent in 2017.

By Paul Elias, The Associated Press

by Canadian Press

Lawyers: Wells Fargo created about 3.5 million fake accounts

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