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Wells Fargo gets another federal penalty lifted, but still has two penalties (AML violation and Gramm-Leach-Bliley Act privacy violation) to clear; analysts expect asset cap could be lifted in the second quarter of 2025

April 29, 2025 //  by Finnovate

Wells Fargo & Co. has reduced the number of federal enforcement actions against it on one front, but it still faces three outstanding issues, including its $1.95 trillion asset cap. The bank said that Consumer Financial Protection Bureau’s (CFPB) 2018 consent order — stemming from its compliance risk management program — has terminated. The Office of the Comptroller of the Currency lifted its consent order for the same issue in February. Wells Fargo Chief Executive Charles Scharf said the bank “is a different and stronger company today” after he took the helm in 2019 to correct its compliance problems. The three major disciplinary actions that remain against Wells Fargo include two from the Office of the Comptroller of the Currency — one last year for violating regulations against money laundering; and a 2015 action by the OCC for violation of the Gramm-Leach-Bliley Act to protect consumer information. For the third, Wells Fargo still faces a $1.95 trillion asset cap imposed by the U.S. Federal Reserve Board in 2018. The bank has been working through deeper scrutiny from regulators in the wake of a phony-accounts scandal that arose nearly a decade ago. Gerard Cassidy, an analyst at RBC Capital Markets, wrote in a research note that he believes the asset cap could be lifted in the second quarter of 2025 “and possibly real[ly] soon.” He pointed not only to the bank’s brisk progress with regulators so far this year, but also to recent comments by Treasury Secretary Scott Bessent. Meanwhile, Wells Fargo’s critics are urging caution about lifting the asset cap, arguing that the scandal-tarred bank hasn’t demonstrated enough progress. In addition to the asset cap, Wells Fargo is operating under a 2015 agreement with the OCC, which states that the bank violated part of the Gramm-Leach-Bliley Act that deals with the consolidation and management of bank subsidiaries. Also still in place is a 2024 formal agreement with the OCC involving what the regulator called “deficiencies” in the bank’s anti-money-laundering controls.

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