Wells Fargo has agreed to pay $108m to the US government to settle allegations of overcharging military veterans on home refinancing loans.
A lawsuit was filed against Wells Fargo in 2006 alleging that some Veterans Administration (VA) Interest Rate Reduction Refinance Loans provided by the bank should not have been eligible for guarantees.
Wells Fargo however denied the allegations, which were made public in 2011.
Wells Fargo CEO Tim Sloan said: “More than six years ago, when questions about fees on Veterans Administration refinance loans were raised, we resolved those concerns by improving our internal controls and made compensation available to VA customers who closed a refinance before that time.
“Settling this longstanding lawsuit allows us to put the matter behind us and continue to focus on serving customers and rebuilding trust with our stakeholders.”
The latest settlement adds to Wells Fargo’s series of scandals that has been plaguing the bank in the recent months. In September 2016, the bank was fined $185m by regulators for illegal sales practice of secretly opening unauthorised deposit and credit card accounts, following which it decided to drop all product sales goals in retail banking.
More recently, the bank agreed to pay $80m in remediation for charging auto insurance from over 570,000 customers without their knowledge.