California Attorney General Kamala D. Harris announced an $8.5 million settlement with Wells Fargo Bank over violations of California privacy law that included recording consumers’ phone calls without timely telling them that they were being recorded. As part of the settlement, which is in the form of a stipulated judgment with no admissions of wrongdoing by Wells Fargo, the bank will pay civil penalties totaling $7.6 million and will reimburse the prosecutors' investigative costs of $384,000. In addition, Wells Fargo will contribute $500,000 to two statewide organizations dedicated to advancing consumer protection and privacy rights.
“Protecting the privacy of California consumers is increasingly crucial as technology rapidly develops and becomes a bigger part of our lives,” said Harris. “This settlement holds Wells Fargo accountable for violating the privacy of its customers by recording calls without providing adequate notification, and ensures that the bank makes the changes necessary to protect the privacy of its customers.”
The civil complaint alleged that Wells Fargo violated Sections 632 and 632.7 of the California Penal Code by failing to timely and adequately disclose its automatic recording of phone calls with members of the public. The AG’s release stated that California has some of strongest privacy laws in the country. In California, each party to a confidential conversation must be advised at the outset if a call is being recorded, so that the individual can object or terminate the call if he or she does not wish to be recorded.
In addition, the settlement agreement states that Wells Fargo must comply with California's standards for recording confidential communications between the bank and its customers by making clear, conspicuous, and accurate disclosures. Wells Fargo has also agreed to implement an internal compliance program to ensure that the policy changes are made, the release stated.
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