FINANCIAL TIMES: The US Department of Justice has sued Wells Fargo for hundreds of millions of dollars, alleging the bank engaged in “reckless” lending practices that defrauded a government insurance programme.
Wells Fargo allegedly put profits ahead of underwriting standards, hired temporary staff to churn out new loans and aligned bonus payments to loan-approval volume, the lawsuit alleges…
“The extremely poor quality of Wells Fargo’s loans was a function of management’s nearly singular focus on increasing the volume of [insurance-eligible loan] originations – and the bank’s profits – rather than on the quality of the loans being originated,” the lawsuit alleged… (more)
