On Jan. 2, CAL INS fined Wells Fargo $10mn re insurance sales.
- Wells Fargo agreed to pay a $10mn penalty, as part of a settlement agreement.
- Follows 2017, accusation to revoke insurance license for practices.
Alleged Violations
- Improper insurance sales practices related to online insurance referral program.
- Consumers were signed up and charged for insurance products without consent.
Settlement
- No transactions of new business during remaining term of two insurance licenses.
- Current insurance licenses are to expire in Jul. and September 2020 respectively.
- Cannot apply for a license for at least 2 years following current license expiration.
- $10mn penalty as part of an agreement with California Department of Insurance.
- $5mn of the penalty due immediately and if the company ever seeks to return to
the California insurance marketplace, it will then pay the remaining $5mn penalty. - Provide restitution to California consumers who were charged premium, bank fee
and other direct monetary losses in connection to unauthorized insurance policies.
