The Federal Reserve terminated two mortgage-related enforcement actions against Wells Fargo & Co. from more than a decade ago, the central bank said Tuesday.
The Fed’s announcement isn’t related to a 2018 enforcement action addressing widespread compliance issues through restrictions on Wells Fargo’s growth. The bank’s executives have been awaiting a decision on whether they have done enough to get the restrictions lifted.
Tuesday’s moves date back to 2011, when the Fed assessed an $85 million civil penalty against Wells Fargo and Wells Fargo Financial Inc. over allegations that employees steered potential prime borrowers into more costly subprime loans. It also accused the firms of falsifying income information in mortgage applications. At the time, it was the central bank’s largest penalty in a consumer-protection enforcement action.
That year, the Fed also ordered 10 banking organizations, including Wells Fargo, to address a pattern of misconduct in residential mortgage loan servicing and foreclosure processing.
“Wells Fargo is a different company today, and the resolution of these two longstanding Federal Reserve consent orders is another indication that our team is establishing the right processes and controls to meet our regulators’ and our own expectations,” Chief Executive Officer Charlie Scharf said in a statement.
