Wells Fargo, the third-largest U. S. bank, said the accord resolves claims that so-called Veterans Administration Interest Rate Reduction Refinance Loans it issued should not have been eligible for federal guarantees.
Wells Fargo & Co. on Friday said it agreed to pay the U. S. government $108 million to settle claims arising from its issuance of loans to military veterans.
The third-largest U. S. bank said the accord resolves claims that so-called Veterans Administration Interest Rate Reduction Refinance Loans it issued should not have been eligible for federal guarantees.
Wells Fargo said the lawsuit, which was filed in 2006 and made public in 2011, sought compensation for guarantee claims paid by the government after loans went into default. It denied the allegations in agreeing to settle.
«Settling this longstanding lawsuit allows us to put the matter behind us and continue to focus on serving customers and rebuilding trust with our stakeholders, » Chief Executive Tim Sloan said in a statement.
Wells Fargo has recently been addressing fallout from some of its other business practices, including the creation of unauthorized customer accounts and the charging of borrowers for auto insurance they did not want or need.
