Wells Fargo pays $37M to resolve Justice Department lawsuit over forex services

Morning In America

(NewsNation Now) — Wells Fargo agreed to pay $37 million to settle a government lawsuit filed by the U.S. Justice Department, accusing the bank of defrauding hundreds of commercial customers.

The bank allegedly overcharged 771 businesses on foreign exchange transactions from 2010 through 2017, according to the U.S. Justice Department lawsuit filed Monday. Wells Fargo shares were down less than 1% in afternoon trading.

The settlement is the latest string of scandals for Wells Fargo. Earlier this month, the company was hit with a $250 million fine on the same day it announced the resolution of a Consumer Financial Protection Bureau consent order.

Wells Fargo told the commercial customers that they were being charged certain fixed rates, but then incentivized salespeople to “overcharge FX customers,” according to the suit.

The bank then concealed the overcharges from customers and obtained “millions of dollars in FX revenue to which the bank was not entitled,” the suit said.

Most of the settlement, $35.3 million, is going as restitution to the overcharged customers, the government said. A whistleblower who kicked off the case in 2016, Paul J. Kohn, is set to receive $1.6 million, the U.S. said.

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