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Feds: Like Wells Fargo, Fifth Third opened fake accounts in real customers' names

In a first, Fifth Third offers early retirement
Posted at 12:06 AM, Mar 10, 2020
and last updated 2020-03-10 00:12:26-04

The Consumer Financial Protection Bureau filed a civil suit Monday against Fifth Third Bank, claiming the company spent at least eight years knowingly allowing employees to open fraudulent accounts and credit lines in the names of real customers.

It’s the same accusation the bureau levied at Wells Fargo in 2016, resulting in a $185 million fine as well as a bevy of other lawsuits.

According to the complaint filed in federal court, Fifth Third created an incentive-based pay and evaluation structure that encouraged workers to “cross-sell” — convince existing customers to sign up for more Fifth Third services.

Often, the bureau’s lawyers wrote, the sales goals set for employees were beyond reasonable expectations.

Workers knew that not meeting them could result in a poor performance rating and subsequent termination.

The bureau’s complaint claims that some employees instead met their quotas by opening deposit accounts and lines of credit for customers without those customers’ knowledge or consent. The practice sometimes included moving sums of a customer’s money into the fake account to meet a deposit quota, then moving it back and closing the account.

Fifth Third Bank denied the allegation in a statement, saying that fewer than 1,500 of its 10 million customer accounts had been identified as fraudulent and that its business practices had not encouraged employees to open fake accounts. According to the bank, employees would have faced penalties for opening accounts that closed so quickly afterward.

“Fifth Third Bank respects and values the important role that the CFPB plays in protecting consumers but believes that the civil suit filed today is unnecessary and unwarranted,” Fifth Third lawyer Susan Zaunbrecher wrote in the statement. “The Bank will defend itself vigorously and is confident in the outcome.”