Wells Fargo has fired about 5,300 workers after an investigation found that "hundreds of thousands of unauthorized deposit accounts" had been opened on behalf of customers as well as "tens of thousands of credit cards" without consent, according to the Los Angeles City Attorney's office.
The bank was slapped with $185 million in fines and civil penalties by city, county and federal authorities.
The Consumer Financial Protection Bureau, a federal agency created in the wake of the financial crisis last decade, estimates that more that 1.5 million deposit accounts may not have been authorized.
The Los Angeles City Attorney's Office said in a statement that the workers funded the unauthorized accounts with cash from customers' existing accounts, allegedly to "satisfy sales goals and earn financial rewards under the bank’s incentive-compensation program."
The CFPB fined the bank $100 million — the largest fine the agency has ever handed down, its director said in a statement.
The bank was also slapped with a fine from the Office of the Comptroller of the Currency for $35 million, and it will pay the County and City of Los Angeles another $50 million as the result of a settlement. It will also be forced to pay full restitution to those affected, the CFPB said.
In a statement, Wells Fargo said understanding the context was important.
"It is important to understand the context, the 5 year period involved and the size of our workforce," a Wells Fargo spokesperson said in a statement. "The actions we have taken with respect to team members and managers reflect our commitment to monitoring and addressing any inappropriate sales conduct. On an annual basis, more than 100,000 team members worked in our stores, and the number terminated represents about one percent of this workforce over the five year period.
"While we regret every interaction that was not handled properly, the number of instances and team members involved represent a very small portion of our business."
Wells Fargo also said it is now sending its customers written confirmations related to new deposit accounts and credit card applications.