Wachovia has started paying its $150M compensation

Wachovia Bank has announced to start mailing 742,870 checks totaling $150,143,361 to the customers suffered from improper access on behalf of telemarketers and their payment processors, including a defunct Newtown Township company. The first checks were mailed Thursday. 

According to the investigation of the U.S. Attorney’s Office in Eastern Pennsylvania and other agencies into Payment Processing Center, a Newtown Township company took $50 million from customers in 2005 and 2006. The scam scheme was very simple: telemarketers from India and the West Indies gained the confidence of trustful consumers and gathered their bank account information, then contracted with Payment Processing Center to withdraw money from the victims’ accounts. Payment Processing Center sent unsigned electronic bank drafts to its bank — Wachovia — to process the payment.

Wachovia was accused of processing the payments though knowing the illegality of transactions from the Payment Processing Center and other processing companies.  

“It is gratifying to see Wachovia step up to restore the victims’ financial losses resulting from telemarketing fraud. These victims can rest assured that these checks are legitimate and that someone is looking out for their interests,” Laurie Magid, acting U.S. attorney for the Eastern District of Pennsylvania, said in a statement.

“Wachovia was pleased to work with the OCC and the U.S. Attorney’s Office to find the best, most comprehensive solution to redress losses incurred by victims of telemarketing abuses,” said bank spokeswoman Christy Phillips-Brown. “The situation was unacceptable. We regret that we failed to stop it.” 

Source: PhillyBurbs