U.S. prosecutors investigate Wells Fargo's sales practices - source

Wed Sep 14, 2016 9:58pm EDT
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By Nate Raymond

NEW YORK (Reuters) - U.S. prosecutors have begun an investigation related to sales practices at Wells Fargo & Co (WFC.N: Quote) that led the bank to agree to a $190 million settlement with regulators, a person familiar with the matter said on Wednesday.

The U.S. Attorneys' Offices in Manhattan and San Francisco are investigating Wells Fargo, the person said, following a settlement announced on Sept. 8 over claims that some customers were pushed into fee-generating accounts they never requested.

Wells Fargo declined to comment on Wednesday. A spokeswoman for U.S. Attorney's Office in Manhattan also declined to comment.

"We don't comment on the existence or non-existence of any investigation," said Abraham Simmons, a spokesman for the U.S. Attorney's Office in San Francisco.

The investigation was first reported by the Wall Street Journal.

The federal prosecutors' probes add a new headache for the company, which has been hit hard by allegations that its staff opened more than two million bank accounts and credit cards for customers without their consent to meet internal sales goals.

As part of last week's settlement, Wells Fargo agreed to pay $185 million in penalties and $5 million to customers. Wells Fargo also said that it had fired 5,300 employees over the sales conduct.

That settlement was with the Consumer Financial Protection Bureau, the Office of the Comptroller of the Currency, and the Office of the Los Angeles City Attorney.   Continued...

The logo on a Wells Fargo bank building is seen in downtown San Diego, California March 18, 2014.
 REUTERS/Mike Blake