Consumer Finance Insights
December 1, 2017

New Mexico AG Announces Investigation Into National Bank for Opening Fake Consumer Accounts

​On November 29, the New Mexico Attorney General (AG) announced that, after a year-long investigation of a national bank, the AG will seek damages on behalf of thousands of New Mexico consumers for whom the bank had created unauthorized banking and credit card accounts.  The AG announced that if he cannot reach a resolution with the bank, he will file a lawsuit​.

The AG’s investigation focused on potential violations of the New Mexico Unfair Practices Act.  According to the AG, the investigation revealed that corporate management at the bank pressured employees to meet demanding quotas to enroll consumers in multiple products through cross-selling.  Employees faced consequences such as job loss if they could not meet their quotas.  In order to meet their quotas, employees opened accounts for customers without their knowledge or authorization.  The bank then charged customers fees in connection with those accounts.  The AG asserts that the bank was aware of the practice, but failed to stop it or create an adequate risk management program to prevent it.