Sep 27, 2021 - Economy

Wells Fargo settles DOJ lawsuit over foreign currency exchange service

A view of a Wells Fargo branch in New York City in August 2016.

A view of a Wells Fargo branch in New York City in August 2016. Photo: Pablo Monsalve/VIEWpress via Getty Images

Wells Fargo agreed to pay $37 million on Monday to settle a Department of Justice lawsuit that accused the bank of overcharging hundreds of its commercial customers using its foreign currency exchange service, according to Bloomberg.

Why it matters: It's the bank's latest financial scandal, coming after a years-long public rehabilitation campaign to recoup the bank's image since it became known in 2016 that it created millions of fake accounts and opened them without account holders' permission.

  • The bank agreed in February 2020 to pay a combined $3 billion to the Justice Department and the Securities and Exchange Commission for opening millions of the fake accounts between 2002 and 2016.

The big picture: The U.S. claimed in the latest lawsuit that the bank defrauded 771 customers, including many small- or medium-sized businesses and banks, by charging more than they claimed for foreign exchange transactions, according to Bloomberg.

  • A judge must still approve the settlement, which also resolves civil fraud charges against Well Fargo, Reuters notes.
  • Wells Fargo did not immediately comment on the settlement.

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