Wells agrees to $1 billion penalty and reimbursements

The rumors in this week's press weren't "fake news." Wells Fargo Bank, N.A. has reached a settlement with the CFPB and the OCC, agreeing to reimburse consumers harmed by the bank's administration of a mandatory insurance program related to automobile loans and by how the bank charged some borrowers for mortgage interest rate-lock extensions. The CFPB's press release says that Wells Fargo will remediate harmed consumers and undertake certain activities related to its risk management and compliance management. The Bureau assessed a $1 billion penalty against the bank and credited a $500 million penalty collected by the OCC toward the satisfaction of its fine.

The OCC's press release reports that the bank's actions were unsafe or unsound, and that it has ordered the bank to make restitution and to develop and implement an effective enterprise-wide compliance risk management program. The OCC reserved the right to "take additional supervisory action, including imposing business restrictions and making changes to executive officers or members of the bank’s board of directors." The OCC's order also modifies restrictions placed on the bank in November 2016 relating to the approval of severance payments to employees and the appointment of senior executive officers or board members. The original restrictions related to severance payments applied to all employees, which unnecessarily delayed severance payments to employees who were not responsible for the bank’s deficiencies or violations. This order maintains restrictions on the approval of severance payments to senior and executive officers and the appointment of senior executive officers or board members.

• CFPB consent order
• OCC CMP order
• OCC Cease and Desist order