Another Wells Fargo mess: Pet insurance ripoff

Not even pet insurance is safe from Wells Fargo's scandals.Wells Fargo has begun refunding customers who were ...

Posted: Jul 20, 2018 1:11 PM
Updated: Jul 20, 2018 1:11 PM

Not even pet insurance is safe from Wells Fargo's scandals.

Wells Fargo has begun refunding customers who were harmed when the bank charged them for products including pet insurance, legal services, home warranties and other forms of insurance, a person familiar with the matter told CNNMoney on Thursday.

An ongoing review at Wells Fargo has found billing and telemarketing problems with so-called "add-on" products that are added to customer accounts, the source said.

Hundreds of thousands of Wells Fargo customers may have been charged for dozens of products they didn't fully understand, The Wall Street Journal reported on Thursday.

Wells Fargo said in a statement on Thursday that it's working with regulators to determine refunds.

Related: Wells Fargo finds even more customers that it overcharged

The bank is in the process of refunding tens of millions of dollars and the Consumer Financial Protection Bureau is investigating whether customers were deceived, the Journal reported.

The CFPB declined to comment.

In a statement, Wells Fargo said it's "reviewing" add-on products sold by the bank or its service providers.

"If issues are found during this review, we will make things right with customers in the form of refunds or remediation," Wells Fargo said. The bank added that it's "working with our regulators on the ongoing review."

Wells Fargo stopped selling the products in question in mid-2017, a person familiar with the matter said.

Wells Fargo previously disclosed in regulatory filings that it was reviewing practices related to certain consumer add-on products, including identity theft and debt protection products. The filings did not indicate the size of the refunds nor that the products included pet insurance and legal services.

Related: Wells Fargo's scandals are hurting its bottom line

The issue is not new for Wells Fargo.

In June 2015, Wells Fargo's regulators fined the bank $4 million for "unfair" and "deceptive" practices in how it billed and marketed identity protection and debt cancellation products.

The regulator, the Office of the Comptroller of the Currency, found that the violations were "part of a pattern of misconduct that resulted in financial gain" to Wells Fargo.

Other big banks have gotten into trouble over shady tactics with add-on products.

In 2015, the CFPB ordered Citibank to pay $700 million in relief to 8.8 million consumer accounts for "deceptive" marketing or retention practices. The CFPB also ordered Citi to pay $35 million in penalties and end its "unfair" billing practices.

JPMorgan Chase was ordered by the CFPB to pay $309 million in refunds for charging credit card customers for credit monitoring services they did not receive.

Related: Why Bank of America branches are disappearing

Of course, refunds are nothing new for Wells Fargo. Over the past two years, Wells Fargo has paid out rebates to customers for opening millions of fake accounts in their names, charging them mortgage fees they didn't deserve and forcing them into car insurance they didn't need.

Last week, Wells Fargo said it's setting aside another $285 million to refund foreign-exchange and wealth-management clients over incorrect pricing and fees.

Wells Fargo executives have expressed hope that the bank is nearing the end of an exhaustive search for more problems inside the bank.

"We're pretty far along, or perhaps done, going business to business looking for areas to correct," John Shrewsberry, Wells Fargo's chief financial officer, told reporters on Friday. "At this point, I would be very surprised if anything else emerged."

There is urgency to wrap things up. In February, Federal Reserve slammed Wells Fargo with unprecedented sanctions that prevent the bank from growing its balance sheet until its problems are fixed. Wells Fargo said it doesn't expect to get out of the penalty box until next year.

Meanwhile, Wells Fargo's business is hurting from all the legal problems at a time when its rivals are booming.

Last week, the bank revealed shrinking profits driven in part by higher expenses and losses from the countless scandals and hefty refunds. Wells Fargo also recently launched an expensive ad campaign aimed at repairing trust with customers. Advertising and promotion spending soared 51% last quarter.

Indiana Coronavirus Cases

Data is updated nightly.

Cases: 1490496

Reported Deaths: 20500
CountyCasesDeaths
Marion2039162521
Lake1001941500
Allen923541011
Hamilton72207547
St. Joseph64053755
Elkhart48903625
Vanderburgh47506523
Tippecanoe43182336
Johnson37906521
Hendricks35984459
Porter34277466
Madison28722537
Clark25552325
Vigo25251344
LaPorte23269307
Monroe22751244
Howard21818377
Delaware21391366
Hancock18487220
Bartholomew17860213
Kosciusko17769201
Warrick16642213
Wayne16062300
Floyd15640257
Grant15143296
Morgan14245231
Boone13388136
Noble11656140
Dearborn11560112
Henry11546201
Shelby11483150
Marshall11258167
Dubois11123152
Jackson10425104
Cass10121142
DeKalb10101129
Lawrence10082220
Huntington10016139
Gibson9415125
Montgomery9153141
Knox8942124
Harrison8874112
Whitley861871
Steuben8488104
Jasper8192114
Clinton810295
Putnam806199
Miami8032133
Jefferson7773124
Wabash7726139
Ripley7118112
Adams6595101
Daviess6455127
Scott638586
White613282
Greene5999112
Clay597573
Wells5902120
Decatur5885119
Jennings586278
Fayette5735121
Posey543448
LaGrange524197
Randolph5027129
Washington494368
Owen491499
Fountain472479
Spencer446556
Starke438686
Sullivan437465
Fulton431891
Orange420882
Jay409764
Rush403937
Carroll377549
Perry376755
Franklin375850
Vermillion352062
Parke319238
Pike316245
Tipton313774
Blackford271755
Pulaski270874
Newton231561
Brown226754
Benton215721
Crawford215131
Switzerland194214
Martin186722
Warren174821
Union165519
Ohio122616
Unassigned0739

Ohio Coronavirus Cases

Data is updated nightly.

Cases: 2439205

Reported Deaths: 31245
CountyCasesDeaths
Franklin2637212065
Cuyahoga2582743018
Hamilton1696091714
Montgomery1126771604
Summit1074271391
Lucas909371160
Butler80397942
Stark754911400
Lorain63313792
Warren51040475
Mahoning50162915
Lake47051605
Clermont44631429
Delaware39611212
Trumbull38910755
Medina37850419
Licking37593408
Fairfield34482334
Greene32823422
Portage31698360
Clark30769445
Richland28751423
Wood28217297
Allen24942395
Miami23274395
Muskingum22683245
Columbiana22370403
Wayne21565356
Tuscarawas19096427
Erie18282222
Ashtabula18102342
Marion17861232
Scioto17031207
Ross16556252
Pickaway15812178
Hancock15561228
Geauga15320223
Lawrence14172186
Union1359984
Huron13584182
Belmont13554247
Jefferson13090258
Sandusky12933199
Athens12126106
Knox11721198
Seneca11631200
Darke10950198
Ashland10916178
Washington10729168
Auglaize10364142
Crawford10062175
Shelby9961157
Brown9610140
Fulton9453150
Guernsey9304117
Highland9215148
Defiance9209135
Logan9114142
Clinton8950127
Mercer8816111
Madison8730106
Preble8145162
Williams8014135
Putnam7863135
Ottawa7752121
Champaign7696112
Jackson7510117
Perry725998
Coshocton7137136
Morrow706382
Fayette678287
Pike632586
Hardin6311128
Gallia605891
Adams5913124
Van Wert5877121
Henry577093
Hocking5634104
Carroll4877100
Wyandot487590
Holmes4787161
Paulding409064
Meigs380473
Monroe303368
Noble285051
Harrison284461
Morgan280348
Vinton245145
Unassigned08
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