Wells Fargo Must Pay $4 Million For Credit Card Violations
Governor Andrew M. Cuomo today announced that Wells Fargo Bank will pay a $2 million penalty and provide approximately $2 million in direct consumer restitution payments for violations uncovered by a Department of Financial Services examination of the Bank’s former affiliate. Among other issues, the Department’s examination found that the Wells Fargo affiliate secured loans made through its Nowline Visa Platinum Credit Card Account product with an interest in the borrower’s home – which is not permissible under New York law.
“New Yorkers deserve to trust who they do business with – and because of this aggressive investigation, individuals and families across the state will be justly compensated,” Governor Cuomo said. “My administration is committed to ensuring that banks and credit card institutions are treating consumers honestly and fairly, and we will continue to do just that.”
Benjamin M. Lawsky, Superintendent of Financial Services, said, “Our investigation uncovered that this Wells Fargo affiliate put borrowers’ homes on the line for routine credit card purchases – creating substantial and undue risks for consumers. This agreement will provide direct relief to New York consumers.”
The 1,300 New Yorkers expected to receive restitution payments are located in the following regions of the state:
Borrowers Receiving Restitution Payments
|Central New York|
|New York City|
|Western New York|
Borrowers will also receive future interest rate reductions of 2 percent on their balances going forward, which is estimated to provide additional relief of approximately $300,000 total. Wells Fargo will also release any security interest or liens they hold in New York homes related to the Nowline Visa Platinum Credit Card Account.
A copy of the consent order between DFS and Wells Fargo is available here.
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