U.S. insurer Prudential Financial Inc said on Monday it had suspended the distribution of a low-cost life insurance policy through Wells Fargo & Co, pending a review of how the product was sold by the bank.
Wells Fargo’s sales practices have been under a spotlight since September when regulators ordered the bank to pay $190 million in fines and restitution to settle charges that its employees opened as many as 2 million deposit and credit card accounts without customers’ permission.
Customer responses in a survey conducted last year did not indicate potential fraudulent activity, Prudential said.
Prudential also said it had asked for Wells Fargo’s assistance in gathering all the necessary facts.
Former Wells Fargo employees have blamed the San Francisco-based bank’s high-pressure sales environment for its role in creating the unauthorized accounts.
Prudential has partnered with Wells Fargo since 2014 to sell the term insurance policy, known as MyTerm, to the bank’s retail customers.
Wells Fargo employees were meant to direct customers to either self-service kiosks in branches or online to buy the insurance, without getting into specifics about the products as bankers are not licensed to sell insurance.
A wrongful termination suit filed in New Jersey state court last week showed that Wells Fargo employees appear to have signed up bank customers for the Prudential policies without the customers’ knowledge or permission.
Some state and local governments have also suspended business with Wells Fargo, as did the Pennsylvania Treasury.
