Scandal, regulatory pressure and structural inefficiencies prompted Wells Fargo, one of the largest U.S. auto lenders, to scale back vehicle loan originations in 2016. Today, Wells Fargo Auto is back in the saddle, growing market share and working on its relationship with dealers.
In the late 2010s, Wells Fargo made headlines over accusations it overcharged hundreds of clients and opened accounts for people who didn’t exist. Wells Fargo’s auto business came under federal scrutiny in 2018 when the Consumer Financial Protection Bureau found the mandatory insurance program attached to the lender's auto loans to be in violation of the Consumer Financial Protection Act.
Since then, Wells Fargo’s autos team has focused on improving consumer and dealership relationships by refining customer onboarding procedures, increasing automated loan approvals and adding sales reps to reach geographically remote dealerships. In early 2019, the lender switched to flexible flat-rate compensation for dealers.
Executive Vice President Laura Schupbach, head of Wells Fargo Auto, told Automotive News the changes are substantial.