Wells Fargo Has to Pay $2.09B For This Wrong Move

Wells Fargo has another big penalty to pay, and this time its for allegedly misrepresenting loan quality, according to the U.S. Attorney’s office in California.

Wells Fargo will have to pay a $2.09 billion civil penalty after the company was accused of originating and selling tens of thousands of residential mortgage loans it knew contained misstated income information and didn’t meet the quality that Wells represented.

The bank’s move had led to mortgage-backed bond investors losing billions of dollars. The bank is not admitting to liability.

“Abuses in the mortgage-backed securities industry led to a financial crisis that devastated millions of Americans,” stated Alex G. Tse, the acting U.S. Attorney for the Northern District of California.

It was just this past April that Wells Fargo had paid $1 billion to settle abuses in sales of products related to auto and mortgage loans.

Disclaimer: We have no position in Wells Fargo & Co. (NYSE: WFC) and have not been compensated for this article.