Wells Fargo not complying with terms of settlements related to sales scandal: Congressional report

According to a Congressional report that was released on Wednesday, Wells Fargo is not complying with the terms of multiple settlements related to its sales scandal.

The U.S. House of Representatives Financial Services Committee released the findings of its year-long probe into the bank ahead of hearings next week wherein its new chief executive, Charles Scharf, and chairman, Betsy Duke, will testify before the committee for the first time.

The Congressional report, based on internal emails and meeting notes, paints a picture of a complacence in Wells Fargo’s board and management, who did not take the terms of the settlements seriously.

The report found that Wells Fargo’s board allowed management to repeatedly submit materially deficient plans to regulators in response to the consent orders, reads the Congressional report. The report also states that regulators have failed to hold Wells Fargo accountable for its wrongdoing.

According to the report, former Wells Fargo CEO Tim Sloan gave “inaccurate and misleading testimony” to Congress during a March 2019 committee hearing when he said the bank was in compliance with a 2018 consent order issued by the Office of the Comptroller of the Currency (OCC) relating to mis-selling of mortgages and auto loans.

Emails between OCC staff-members proved that the bank was not in compliance with one of two aspects of the order’s customer remediation plan; the OCC staff also concluded that Sloan gave inaccurate testimony to Congress, states the report.

Since 2016, Wells Fargo has paid more than $7 billion in fines and penalties with regard to the scandal with internal and external probes uncovering issues in each of Wells Fargo’s major business lines, including wealth management and the commercial bank.

Categories: Creativity, Economy & Finance, Entrepreneurship, HR & Organization, Regulations & Legal, Strategy

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