Wells Fargo adds $1bn to possible legal expenses

Wells Fargo added $1 billion in the third quarter to what it says the bank may face in possible legal expenses.

Bloomberg News reports that legal costs could potentially be $3.3 billion more than what the San Francisco-based bank has reserved, Wells Fargo said Friday in a regulatory filing.

While that figure was unchanged from the previous three-month period, it constitutes a $1 billion increase because Wells Fargo moved a similar amount into legal reserves during the period.

The bank announced a surprise $1 billion charge in the third quarter for a previously disclosed regulatory investigation into its pre-financial crisis mortgage activity when it reported third quarter earnings. Banks typically move funds into an accrual when they determine a cost is no longer “reasonably possible” and instead becomes probable.

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Wells Fargo Adds $1 Billion to Possible Legal Cost

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