Wells Fargo will close all its personal credit lines, causing outrage among consumers and advocates.
According to a spokesperson for Wells Fargo, the bank made the decision last spring as part of a move to simplify its product offerings. According to the spokesperson, the bank believes it can better serve borrowing needs by offering credit cards and personal loans.
According to Daily Reuters, the bank’s popular consumer lending product, users can borrow up to $100,000. Consumers were offered the product to consolidate higher-interest credit card debt and pay for home renovations.
The bank sent notices to customers regarding the closure and warned them that it could affect their credit scores.
Wells Fargo trended on Twitter Thursday night after Daily Reuetrs report. Consumer advocates including Senator Elizabeth Warren were outraged.
“Not one @WellsFargo customer should have their credit score drop because their bank is restructuring following years of frauds and incompetence.” Not sending out a warning notice is not enough. Wells Fargo must do this right.
This news comes four years after a scandal in which the bank opened millions of fake accounts. It also forced customers to pay unnecessary mortgage fees and auto insurance. It was called “widespread customer misuse” by the Federal Reserve. In 2018, Wells Fargo placed a cap on its assets, effectively preventing it from increasing its balance until it addressed the compliance issues that led to the scandal.