Are Unwanted Credit Cards Due to Unauthorized Bank Accounts?
You would be smart to question any new credit card that arrives in the mail without requesting it. It could simply be a replacement to your existing card or it could be a new card with higher fees and interest rates.
A lawsuit was filed against Fifth Third Bank alleging that the institution opened new accounts without consumers’ knowledge or consent. The bank supposedly opened deposit and credit-card accounts in existing consumers’ names, transferred funds from existing accounts to new accounts, enrolled consumers in unauthorized online-banking services, and activated new unauthorized lines of credit.
The 2020 lawsuit alleged that Fifth Third violated the Consumer Financial Protection Act’s prohibition against unfair and abusive acts or practices as well as the Truth in Lending Act and the Truth in Savings Act.
Fifth Third used what investigators called a “cross-sell” strategy to increase the number of products and services it provided to existing customers.
Can I Join Unauthorized Bank Accounts Lawsuits?
Despite past legal action by regulators, several banks are being investigated for illegal banking practices that include excessive overdraft fees, hidden fees, and unauthorized bank accounts.
Some banks have been fined by the Consumer Financial Protection Bureau for illegally accessing consumer credit reports and opening accounts without proper permission, but that does not mean the matter has been resolved. Some class actions are still ongoing as customers are looking to reach a settlement.
Consumer protection laws exist for your benefit. Large corporations have gotten away with dubious business practices for decades, but the law can be on your side. Contact our lawyers to consider legal action and to seek rightful compensation after your rights are violated.
The Lyon Firm has filed class action claims in the following practice areas:
Banks Investigated for Unauthorized Accounts
U.S. Bank Investigation
The CFBP fined U.S. Bank $37.5 million after a five-year investigation concluded that employees were taking advantage of customers by misappropriating consumer data to create fake accounts. The agency said an investigation found evidence that the bank’s sales campaigns and compensation programs rewarded staff for selling bank products, however dubious.
Wells Fargo Investigation
Wells Fargo was accused of fraudulently opening unauthorized bank accounts in consumers’ names and transferring funds. In 2020, Wells Fargo ultimately agreed to pay $3 billion to federal regulatory agencies to settle the investigation into the fraudulent practices.
Wells Fargo has also been allegedly fraudulently obtained valuable true and correct personal identification and personal financial information for unauthorized accounts. Wells Fargo was previously fined by federal regulators for creating accounts for some clients without their knowledge for over a decade.
As a result, millions of fraudulent customer accounts were created, the Department of Justice reported. As part of the 2020 $3 billion deal, Wells Fargo admitted that between 2002 and 2016 it pressured employees to meet “unrealistic sales goals that led thousands of employees to provide millions of accounts or products to customers under false pretenses or without consent, often by creating false records or misusing customers’ identities.”
Bank of America Investigation
Bank of America was ordered to pay $250 million in fines and customer compensation after the Consumer Financial Protection Bureau found that the bank violated consumer protection laws. BofA was also fined $727 million in 2014 for illegal credit card practices. The bank was found to double-charge insufficient fund fees, withheld credit card rewards and welcome bonuses, and opened unauthorized credit card accounts without customer consent.
Bank employees used consumers’ personal information to enroll in fake credit card accounts. Lawyers have characterized the practice of opening unauthorized card accounts as identity theft.