Wells Fargo Consent Order for Fake Accounts Ended by Regulator
Related: ‘The Fish Rots From the Head Backwards:’ Why Fixing Wells Fargo’s Culture Is Taking So Long
The consent-order termination “moves Wells Fargo a little closer to getting the Federal Reserve’s asset cap lifted, but we don’t think it’s quite there yet since a few other consent orders are still outstanding and scrutiny lingers over the bank’s financial controls,” said Elliott Stein, a senior litigation analyst with Bloomberg Intelligence.
Investigators found that the company set overly aggressive sales targets that led employees to open millions of fake accounts for customers to meet goals, often by creating false records or misappropriating their identities, generating millions of dollars in fees and interest and damaging some clients’ credit ratings, according to the Justice Department.
The bank in September settled a $1 billion shareholder lawsuit over the unauthorized accounts that brought the total amount the company has agreed to pay to resolve related claims to almost $5 billion.
See: A Timeline of Wells Fargo Scandals
The scandals also claimed two CEOs. Scharf succeeded Tim Sloan, who took over Wells Fargo weeks after the scandal erupted at the firm. John Stumpf, his predecessor who had run the bank since 2007, stepped down amid intense scrutiny from Washington and beyond.
(Credit: Bloomberg)
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