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 12:11 PM
Updated: Jul 20, 2018 12:11 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.

Mississippi Coronavirus Cases

Data is updated nightly.

Cases: 144544

Reported Deaths: 3729
CountyCasesDeaths
DeSoto956999
Hinds9541193
Harrison6825105
Jackson6068116
Rankin523796
Lee480294
Madison4602102
Forrest367185
Jones344687
Lauderdale3343142
Lafayette313347
Washington3088106
Lamar281849
Bolivar237883
Oktibbeha237760
Lowndes228362
Neshoba2171113
Panola211047
Marshall207247
Leflore200789
Pontotoc193227
Monroe189577
Sunflower189554
Lincoln183964
Warren172157
Tate163349
Union160125
Pike160058
Copiah158840
Yazoo150638
Scott149929
Coahoma147342
Itawamba145533
Alcorn143724
Simpson143553
Pearl River142967
Prentiss139526
Grenada136344
Adams135948
Leake131643
Holmes124461
George121623
Tippah120930
Covington117234
Winston115824
Wayne115722
Hancock114137
Marion110746
Attala106233
Tishomingo106042
Newton102829
Chickasaw102332
Tallahatchie94727
Clarke88253
Clay86726
Jasper81121
Walthall74328
Stone72314
Montgomery71925
Calhoun71213
Carroll70514
Lawrence69914
Noxubee69017
Smith68616
Yalobusha67926
Perry65225
Tunica59519
Greene58422
Claiborne57416
Jefferson Davis54117
Humphreys52518
Amite50814
Benton48217
Quitman4786
Webster41614
Kemper40815
Wilkinson38422
Jefferson34011
Franklin3185
Sharkey30617
Choctaw3057
Issaquena1114
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Alabama Coronavirus Cases

Cases: 234080

Reported Deaths: 3459
CountyCasesDeaths
Jefferson30620491
Mobile19306358
Tuscaloosa12501148
Madison12410146
Montgomery12040232
Shelby980576
Baldwin826984
Lee753964
Morgan618247
Calhoun5997113
Etowah590564
Marshall581953
Houston507038
DeKalb463535
Cullman412636
Limestone404544
St. Clair398455
Elmore393961
Lauderdale382953
Walker349096
Talladega335942
Colbert296341
Jackson291924
Blount276336
Autauga263439
Franklin244833
Coffee233415
Dale226654
Dallas220231
Russell21803
Chilton216937
Covington212533
Escambia194431
Tallapoosa169290
Chambers168048
Pike155514
Clarke155419
Marion134535
Winston123723
Lawrence122436
Geneva11748
Marengo116924
Barbour116110
Pickens115318
Bibb114217
Butler113741
Randolph99821
Cherokee98924
Hale91631
Washington90018
Clay89423
Fayette84416
Henry8426
Lowndes78729
Monroe76811
Cleburne74414
Crenshaw70330
Macon70020
Bullock69019
Conecuh66814
Perry6686
Lamar6267
Wilcox62418
Sumter55322
Choctaw41713
Greene40217
Coosa3074
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