Wells Fargo Customer Account Scandal: Regulatory Policy Issues [September 28, 2016] [open pdf - 162KB]
"Wells Fargo Bank, N.A., is a large federally chartered depository bank. Reportedly, thousands of Wells Fargo employees harmed bank customers in a variety of ways, including opening unauthorized deposit and credit card accounts in customers' names, enrolling customers in online banking services they did not ask for, and transferring funds among existing and unauthorized accounts. These revelations present a number of policy issues in the areas of consumer protection, corporate governance, regulatory agency performance, and congressional oversight. This scandal is being examined at House and Senate hearings. For additional information about the Wells Fargo scandal, see CRS [Congressional Research Service] Legal Sidebar WSLG1671, Wells Fargo's Selling Campaign--Enforcement Actions, Civil Penalties, and Possible Criminal Charges, by M. Maureen Murphy. Some agency actions have already been taken. On September 8, 2016, the Office of t he Comptroller of the Currency (OCC) and the Consumer Financial Protection Bureau (CFPB), in coordination with the Los Angeles City Attorney (LACA), imposed a total of $185 million in civil money penalties on Wells Fargo Bank. In addition to the civil penalties, Wells Fargo is required to provide restitution to harmed customers but was not required to admit wrongdoing. These enforcement actions do not preclude further actions by regulators or criminal charges by federal prosecutors. Under the agencies' enforcement actions, no executives or employees have been penalized yet."
CRS Insight, IN10587
Federation of American Scientists: http://www.fas.org/sgp/crs/index.html