FOR IMMEDIATE RELEASE
Jan. 17, 2023
CONTACT
Carter Dougherty
carter@ourfinancialservices.org
(202) 251-6700
OCC Should Follow CFPB Lead in Drawing Tough Line on Repeat Offenders
The nation’s big-bank regulator, the Office of the Comptroller of the Currency, should help broaden and extend a crackdown on financial institutions that repeatedly violate the law – notably Wells Fargo – with all the tools at its disposal.
The comptroller, Michael Hsu, is speaking today at the Brookings Institution on the problem of “too big to manage,” a phrase applied to large banks that profit at the expense of their own customers.
“Repeat offenses are precisely the data points that tell us a bank has a too-big-to-manage problem,” said Sarah Pray, managing director for policy at Americans for Financial Reform. “Wells Fargo has repeatedly ripped off its own customers, even after new executive teams promise a fresh start. As Wells Fargo’s main supervisor, the OCC is in a unique position to identify the structures at the megabank that result in repeated rampant abuses and impose lasting change – including structural change.”
The speech comes about a month after the Consumer Financial Protection Bureau ordered Wells to pay $3.7 billion over widespread mismanagement of auto loans, mortgages, and deposit accounts, and promised to work with other federal regulators to find durable solutions to its constant violations of the law.
The OCC, which is Wells Fargo’s primary federal banking regulator, imposed restrictions on its mortgage servicing business in 2021 after it violated a 2018 consent order, and the Federal Reserve, which oversees the corporate entity that holds all its business lines, slapped a $1.93 trillion asset cap on the bank in 2018 in the wake of numerous scandals at the bank.
Wells Fargo’s misdeeds have been numerous and egregious enough to vault it into popular culture, notably Late Night with Seth Meyers, Saturday Night Live. AFR has documented its role as a serial lawbreaker, in the Wells Fargo Scandal Tracker.
CFPB Director Rohit Chopra said on Dec. 20 that the consumer agency would work with other regulators to “collectively consider whether additional limitations” on Wells Fargo are appropriate.
“We are concerned that the bank’s product launches, growth initiatives, and other efforts to increase profits have delayed needed reform,” Chopra said on Dec. 20. “We will continue our work with the other federal banking regulators to end the rinse-repeat cycle of consumer abuse at this firm.”
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