CFPB Slams Wells as a ‘Repeat’ Abuser of its Customers, Orders $3.7 Billion in Redress
smanas@imfpubs.com
The Consumer Financial Protection Bureau Tuesday morning rolled out a $3.7 billion enforcement action against megabank Wells Fargo, accusing the company of engaging in illegal conduct tied to auto and mortgage lending as well as abuses on overdraft fees.
On the mortgage front, the bureau said Wells — the nation’s largest servicer of residential loans at $961 billion — for at least seven years improperly denied thousands of mortgage loan modifications, which in some cases led to wrongful foreclosures.
The bureau said the San Francisco-based depository knew of the issue for years before it fixed the problem.
The bank, which has been under CFPB scrutiny for a myriad of alleged consumer abuses dating back at least six years, issued a statement about the settlement in which CEO Charlie Scharf said that today, Wells is a “different” company.
The firm, also the nation’s third-largest home lender (according to Inside Mortgage Finance), will take an “operating losses expense” of at least $3.5 billion for the fourth quarter because of the settlement.
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