WASHINGTON, D.C. — Sen. Sherrod Brown (D-OH), Chairman of the Senate Committee on Banking, Housing, and Urban Affairs, joined fellow Banking and Housing Committee members Elizabeth Warren (D-MA), Catherine Cortez Masto (D-NV), Chris Van Hollen (D-MD), and Robert Menendez (D-NJ) in a letter to Andrew Cecere, CEO of U.S. Bank, requesting information about the bank’s use of consumer data to open unauthorized bank accounts. The letter comes after the Consumer Financial Protection Bureau (CFPB) fined the bank $37.5 million for illegally accessing consumers’ credit reports to open fake checking and credit accounts, accrue fees, and increase profits.
“It is unacceptable that U.S. Bank provided incentives to and pressured its employees to take advantage of their unique access to a veritable treasure trove of sensitive, personal information to sign up unsuspecting customers for fee-generating financial products and services,” wrote the Senators.
Brown has led the fight to protect consumers from banks’ malicious practices. Last week, he led his colleagues in reintroducing the Fair Access to Financial Services Act, which would hold financial institutions accountable for discriminatory practices. In May, he sent a letter to Wells Fargo highlighting the bank’s history of consumer abuses. Brown also led the charge against Wells Fargo after it was found that the bank opened millions of fake customer accounts.
A copy of the letter is available here and below:
Dear Mr. Cecere:
We are deeply concerned by the reported misconduct by U.S. Bank National Association (“U.S. Bank”) that led the Consumer Financial Protection Bureau (“CFPB” or “Bureau”) to issue a consent order and $37.5 million fine against U.S. Bank for illegally using consumer data to issue credit cards and lines of credit and to open deposit accounts for consumers without their knowledge or consent. Troublingly, this is the second time in less than a decade where the federal government has sought accountability and redress by a major bank for perpetuating this practice – since 2016, Wells Fargo has paid a $3 billion penalty in a settlement with the Securities and Exchange Commission (“SEC”), in addition to a $100 million fine to the CFPB, a $35 million to the Office of the Comptroller of the Currency (“OCC”), and a $50 million fine to the City and County of Los Angeles for unlawfully opening fake accounts for millions of customers without their approval.
The CFPB’s consent order tells a problematic story. According to the Bureau, U.S. Bank, the nation’s fifth largest commercial bank, sought to increase sales of its products and services by rewarding employees who met sales goals and generated more revenue for the bank through an incentive-compensation program. Under this pressure, employees engaged in unlawful activity by utilizing customers’ personal identifying information to open deposit accounts, apply for and issue credit cards, and open lines of credit from 2010 to 2020. All of these products accrued fees and increased profits for U.S. Bank – to the detriment of its own customers. The CFPB found that these practices violated federal consumer laws and violated individual consumers’ control over their data privacy
Banks are entrusted with customers’ most sensitive information in support of applications for mortgages, loans, credit cards, deposit accounts, and financial services necessary to participate in the economy. It is unacceptable that U.S. Bank provided incentives to and pressured its employees to take advantage of their unique access to a veritable treasure trove of sensitive, personal information to sign up unsuspecting customers for fee-generating financial products and services.
We request that U.S. Bank brief Congressional staff on the matter. Additionally, to understand the full scope of the problem, we request responses to the following by September 6, 2022:
The Committee plans to hold its Annual Wall Street Oversight Hearing in September of this year and we look forward to your participation.
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