Twelfth consent order closed since 2019, with only two actions remaining
Wells Fargo has cleared another hurdle in its long-running efforts to resolve regulatory issues, with the Consumer Financial Protection Bureau (CFPB) lifting a 2018 consent order related to the bank’s compliance risk management program, the company announced Monday.
The termination of the order marks the twelfth consent order resolved since 2019, moving Wells Fargo closer to easing the regulatory burdens that have kept it under a $1.95 trillion asset cap imposed by the Federal Reserve.
“Today’s termination, along with the recent closure of other consent orders, demonstrates that we have completed much of our common risk and control infrastructure work, including work that is required by other orders,” Wells Fargo CEO Charlie Scharf said in a press release.
Earlier this year, the Office of the Comptroller of the Currency (OCC) also lifted a similar consent order tied to the same compliance risk issue. The closure of these orders addresses a multiagency complaint centered on the bank’s risk management shortcomings.
Will Fed’s asset cap be lifted next?
Analysts are viewing the CFPB’s latest move as a strong signal that the Fed may soon lift its asset cap on Wells Fargo, a cap that has severely limited the bank’s growth since it was imposed in 2018 following a series of scandals.
“The biggest consent order investors are expecting to be lifted is the Federal Reserve’s 2018 cease and desist order that has the asset cap linked to it,” analysts at Royal Bank of Canada wrote in a research note Monday. “In view of the six consent orders being lifted this year and Treasury Secretary [Scott] Bessent’s commentary regarding loosening the regulatory ‘corset’ around the banking system, we believe the Federal Reserve’s 2018 order could be lifted in the 2Q25 and possibly real soon.”
Analysts at Piper Sandler also highlighted the “increasingly rapid resolution pace” of Wells Fargo’s consent orders, noting that regulators now appear more comfortable with the bank’s improved compliance and risk management practices. They similarly linked the progress to a potential lifting of the asset cap.
A Wells Fargo spokesperson, however, declined to comment on the Fed’s asset cap timeline.
Currently, two regulatory actions still remain: A 2015 consent order from the OCC relating to violations of the Gramm-Leach-Bliley Act, and a formal agreement (an enforcement action but not a consent order) issued by the OCC in September 2024 related to Wells Fargo’s anti-money laundering efforts, the spokesperson confirmed.
Sales scandal settlement
In a separate regulatory development, the OCC announced on Friday that it has settled enforcement actions against two former Wells Fargo executives tied to the bank’s notorious sales practice misconduct from nearly a decade ago.
The OCC issued a $100,000 civil penalty against David Julian, former chief auditor, and a $50,000 civil penalty against Paul McLinko, former executive audit director. Both were also issued personal cease-and-desist orders.
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The settlement resolves a 2020 investigation into the 2016 scandal where Wells Fargo sales teams enrolled customers in services and products without their consent to meet sales targets. Regulators accused Julian of failing to “plan and manage audit activity that would detect and document sales practices misconduct,” and criticized his failure to escalate concerns adequately.
Earlier this year, the OCC had initially fined Julian $7 million and McLinko $1.5 million for related conduct. McLinko was also cited for failing “to maintain professional independence from the Community Bank.”
Wells Fargo declined to comment on the OCC’s settlements with the former executives.
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