WASHINGTON — The Consumer Financial Protection Bureau has told Congress that “all options are on the table” for enforcing a 2018 consent order against Wells Fargo, raising the prospect of potential future penalties or other sanctions against the bank.
In a letter to Democratic Senators Elizabeth Warren and Sherrod Brown published by the lawmakers on Tuesday, CFPB Director Kathy Kraninger said she was unhappy with Wells Fargo’s progress fixing its risk management issues.
“I am not satisfied with the bank’s progress to date and have instructed staff to take all appropriate actions to ensure the bank complies with the consent order and Federal consumer financial law,” she wrote in the letter dated April 5.
“Broadly speaking, I consider all options on the table for enforcing Bureau consent orders,” Kraninger added.
Wells Fargo Wells declined to comment.
In April 2018, the CFPB and the Office of the Comptroller of the Currency jointly fined Wells Fargo $1 billion for mis-selling auto loans and mortgage products and ordered the bank to repay harmed customers and fix its controls and processes.
The terms of the consent order give Kraninger and OCC Director Joseph Otting extensive powers to sanction the bank with additional penalties, business restrictions or the removal of bank personnel if they believe it has failed to devise a satisfactory remediation plan.
“The OCC is fully engaged and prepared to ensure Wells Fargo corrects the identified deficiencies,” Otting wrote in a separate April 3 letter to Warren.
Federal Reserve Chair Jerome Powell, also writing to the senators on April 3, repeated his pledge to retain an asset cap the Fed imposed on the bank in February 2018 until it has met its obligations under that separate consent order.
The bank has said it is committed to compensating all customers affected by its actions and has already payed out tens of millions of dollars to make consumers whole.
Senators Warren and Brown wrote to the three regulators on March 22 seeking reassurance that they would take a tough line on the bank and calling on them to remove CEO Tim Sloan. Sloan announced he was resigning on March 28.
Reuters reported on Tuesday that Sloan’s departure was at least partly the result of the board’s conclusion that he had failed to convince regulators that he could transform the bank and rally a staff that had low confidence in its leadership.