Wells Fargo & Co. will pay a $250 million fine after the Office of the Comptroller of the Currency said the company has deficiencies in its home-lending business and violated a 2018 order tied to past consumer missteps.
The order, the first such sanction under Chief Executive Charlie Scharf, cited problems in home-lending loss mitigation practices — the steps firms take to avoid foreclosure — that have impaired the bank from being able to “fully and timely” make harmed customers whole. Bloomberg reported last week that the regulator had warned the company it might bring new sanctions tied to the company’s pace in fulfilling its obligations.
“Wells Fargo has not met the requirements of the OCC’s 2018 action against the bank,” Michael Hsu, the regulator’s acting chief, said in a Thursday statement. “This is unacceptable.”
In addition to the penalty, Hsu said the OCC is putting limits on the bank’s future activities until it fixes problems tied to mortgage servicing. The regulator ordered the bank not to acquire certain third-party residential mortgage servicing and to ensure borrowers aren’t transferred out of its loan-servicing portfolio until remediation is provided.
Scandals have plagued Wells Fargo since 2016, beginning with the revelation that employees opened millions of fake accounts to meet sales goals. Problems multiplied across business lines, leading to additional sanctions from regulators including a costly asset cap from the Federal Reserve.
The problems also led to leadership shakeups, including the resignations of two CEOs, and a six-month search for an outsider to do the job. Scharf, who took over almost two years ago, has called satisfying U.S. authorities demands his highest priority.
“Our work to build the right foundation for a company of our size and complexity will not follow a straight line,” Scharf said in a statement Thursday. “We are managing multiple issues concurrently, and progress will come alongside setbacks. That said, we believe we’re making significant progress, the work required is clear, and I remain confident in our ability to complete it.”
Shares of Wells Fargo rose 1.2% to $44.90 at 6:25 p.m. in New York after-market trading Thursday. The stock has gained about 47% this year.
A new proposal could end the ban on promoting client reviews in states like California and Connecticut, giving state-registered advisors a level playing field with their SEC-registered peers.
Morningstar research data show improved retirement trajectories for self-directors and allocators placed in managed accounts.
Some in the industry say that more UBS financial advisors this year will be heading for the exits.
The Wall Street giant has blasted data middlemen as digital freeloaders, but tech firms and consumer advocates are pushing back.
Research reveals a 4% year-on-year increase in expenses that one in five Americans, including one-quarter of Gen Xers, say they have not planned for.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
