Mar 6, 2020 - Economy & Business

The banking industry's fake account scheme may have been widespread

Wells Fargo logo on side of bank

Photo: Robert Alexander/Getty Images

The latest bank in the crosshairs of the Consumer Financial Protection Bureau is Fifth Third Bancorp, which disclosed in a securities filing this week that the CFPB is targeting the bank for “alleged unauthorized account openings,” American Banker's Kate Berry reported.

Why it matters: Wells Fargo has faced billions in fines and penalties and had been held up as a singular example of corporate wrongdoing for its account fraud scandal, but the disclosure of the complaint against Fifth Third could mean that there are one or many other shoes to drop.

  • It means the practice of forcing employees to create fake accounts for customers without their knowledge may have been widespread within the banking industry.

Flashback: Wells Fargo’s account fraud scandal also began with a CFPB enforcement action.

  • After the Wells Fargo scam came to light it was revealed the U.S. Office of the Comptroller of the Currency already was investigating 40 other banks for similar actions.
  • In September, Bank of America revealed that it was also under investigation by the CFPB for "potentially unauthorized credit card accounts.
  • Fifth Third only recently converted to a national bank charter from a state charter, so it was likely not involved in the OCC's investigation of national banks.

Go deeper: Wells Fargo agrees to pay $3 billion to settle consumer abuse charges

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