Senator Elizabeth Warren said Jan. 17 that Wells Fargo “does not belong on college campuses” following her review of a long-delayed Consumer Financial Protection Bureau report finally released in December 2018 that found the bank charged students the highest fees among 573 institutions examined—and almost 30 percentage higher than the second most-expensive bank.
The CFPB report stated Wells Fargo charged an average of $46.99 in fees each year to students, while the average fees for the largest provider of college banking services, BankMobile, was $12.12. After Wells Fargo, the next highest average annuals fees came from the University of Kentucky Federal Credit Union, at $37 a year.
In a statement, Warren said, “When granted the privilege of providing financial services to students through colleges, Wells Fargo used this access to charge struggling college students exorbitant fees.”
The CFPB report was produced in 2017 under leadership appointed by Barack Obama, and only released in December 2018 in response to a Freedom of Information Act request.
Wells Fargo has suffered a series of scandals and disclosures starting in 2016 when news broke that the company had opened at least two million accounts for its customers without permission. Over 5,000 employees were fired and the CEO resigned. In 2017, the bank disclosed it had charged hundreds of thousands of customers for car insurance they didn’t need or want. The firm paid a billion dollars in 2018 to settle an array of federal probes.
Warren sent letters Jan. 15 asking for more information from Wells Fargo’s CEO by Feb. 5, and informing 31 colleges at which the bank has direct arrangements of the firm’s high fees. She also sent letters to the heads of several other banks and credit unions, including Citigroup, JPMorgan Chase, and U.S. Bancorp.
Many colleges have arrangements with banks that link a student ID directly to a student’s accounts in exchange for certain fee agreements or services offered by the financial institution.
