Wells Fargo President and CEO Charlie Scharf attends The Wall Street Journal’s “The Future of Everything” presentation at Spring Studios on May 17, 2022 in New York City.
Steven Ferdman | Getty Images Entertainment | Getty Images
Wells Fargo said Thursday one of its key regulators has lifted a key penalty related to the 2016 fake accounts scandal.
The bank said in a news release that the Office of the Comptroller of the Currency has revoked a consent order that had forced it to overhaul the way it sells its retail products and services.
The bank’s shares rose more than 6% on the news.
Wells Fargo, one of the country’s largest retail banks, has withdrawn six consent orders since 2019, the year CEO Charlie Scharf took over. There are eight more remaining, led by one from the Federal Reserve that limits the bank’s assets, according to a person familiar with the matter.
In a memo to employees, Scharf called the development a “milestone” for the lender. The 2016 fake accounts scandal — in which the bank admitted to setting up customers in more than 3 million unauthorized accounts — sparked a wave of investigations that uncovered problems related to the servicing of mortgages, auto loans and other consumer accounts .
The attention damaged the bank’s reputation and forced the resignation of both former CEO John Stumpf in 2016 and his successor Tim Sloan in 2019.
“The OCC’s actions are confirmation that we have effectively implemented new systems, processes and controls to serve our customers differently today than we did a decade ago,” Scharf said. “It is our responsibility to ensure that we continue to work with these disciplines.”
The reversal of the OCC order “paves the way” for the Fed’s asset cap to be finally lifted, RBC analyst Gerard Cassidy said in a research note on Thursday.
—CNBC’s Leslie Picker contributed to this report.
Don’t miss these stories from CNBC PRO:
Source link
2024-02-15 20:12:48
www.cnbc.com
