Wells Fargo has agreed to pay $110 million to settle a class-action lawsuit over up to 2 million accounts its employees opened for customers without getting their permission, the bank announced Tuesday. It's the first private settlement that Wells has reached since the company paid $185 million to federal and California authorities late last year, the AP reports. Authorities said bank employees, driven by high-pressure sales tactics, opened the bank and credit card accounts without customer authorization.The settlement will include customers who had accounts opened without their permission, or were signed up for a product they did not agree to, going back to Jan. 1, 2009.
Wells Fargo says it believes this settlement, which is subject to court approval, will resolve the 11 other pending class-action lawsuits filed against it over the accounts. After paying attorneys' fees, the $110 million will first go to cover any customers' out-of-pocket losses or fees that they may have incurred due to the unauthorized accounts. All remaining money will be split among the all impacted customers. Wells also disclosed Tuesday that a federal regulator had downgraded its rating under a law designed to help monitor and promote banking practices to low-income and minority communities. The Office of the Comptroller of the Currency cited the sales practices as one reason for the downgrade. (Read more Wells Fargo stories.)