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.

Minnesota Coronavirus Cases

Data is updated nightly.

Cases: 560450

Reported Deaths: 7122
CountyCasesDeaths
Hennepin1167211690
Ramsey48313858
Dakota42928423
Anoka38965419
Washington25195274
Stearns21198219
St. Louis16926298
Scott16187118
Wright14964128
Olmsted1282897
Sherburne1072580
Carver993045
Clay787390
Rice7701102
Blue Earth704240
Kandiyohi631381
Crow Wing624286
Chisago554750
Otter Tail547673
Benton536697
Mower453032
Goodhue448572
Douglas446071
Winona439549
Nobles401948
Morrison397559
McLeod397255
Isanti382559
Itasca379053
Beltrami375457
Polk367967
Steele366214
Becker359448
Lyon349748
Carlton331152
Freeborn329629
Pine313821
Nicollet310343
Brown295639
Mille Lacs285450
Le Sueur273822
Todd270030
Cass252526
Meeker239137
Waseca231921
Martin215230
Wabasha20003
Roseau198319
Hubbard174441
Renville172943
Dodge17253
Redwood166735
Houston162714
Cottonwood158221
Fillmore15229
Pennington151519
Chippewa147537
Wadena145821
Faribault145519
Sibley137110
Kanabec133622
Aitkin129436
Watonwan12609
Rock123419
Jackson118210
Yellow Medicine111319
Pipestone110526
Pope10386
Murray10319
Swift100418
Marshall85817
Stevens83310
Lake78819
Clearwater78514
Koochiching77813
Wilkin77312
Lac qui Parle73922
Big Stone5764
Lincoln5613
Grant5528
Norman5229
Mahnomen5178
Unassigned48678
Kittson46822
Red Lake3877
Traverse3625
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Cook1480

Iowa Coronavirus Cases

Data is updated nightly.

Cases: 359450

Reported Deaths: 5839
CountyCasesDeaths
Polk56274608
Linn20392330
Scott19245236
Black Hawk15611306
Woodbury14960221
Johnson1415481
Dubuque13196203
Dallas1094596
Pottawattamie10804162
Story1035747
Warren559186
Clinton541791
Cerro Gordo524987
Webster508792
Sioux507873
Marshall477575
Muscatine463297
Des Moines443165
Wapello4255121
Buena Vista422140
Jasper408470
Plymouth398779
Lee369255
Marion355775
Jones293455
Henry286837
Carroll280152
Bremer279860
Crawford262840
Boone259633
Benton251155
Washington249850
Dickinson243743
Mahaska225750
Jackson218942
Kossuth213763
Clay212325
Tama206971
Delaware204539
Winneshiek194933
Page190721
Buchanan189031
Cedar185023
Fayette183541
Hardin181942
Wright180635
Hamilton178449
Harrison176673
Clayton167355
Butler162734
Mills159020
Cherokee157738
Floyd156242
Lyon155341
Madison154819
Poweshiek153233
Allamakee149351
Iowa146224
Hancock144234
Winnebago136931
Grundy135532
Cass135154
Calhoun133411
Jefferson131235
Emmet129940
Shelby129037
Sac128419
Louisa127349
Appanoose126747
Mitchell125441
Union123332
Chickasaw122715
Guthrie118529
Humboldt118426
Franklin113121
Palo Alto111323
Howard102922
Montgomery101537
Unassigned10040
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Keokuk95031
Monroe94528
Ida90133
Adair84832
Pocahontas84121
Monona81430
Davis79924
Osceola77116
Greene76710
Lucas75723
Worth7138
Taylor65412
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Ringgold53624
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