In 2018, Wells Fargo entered into consent orders with three regulators—the Federal Reserve Board, the Office of the Comptroller of the Currency, and the Consumer Financial Protection Bureau (CFPB) stemming from a fake customer accounts scandal. Those consent orders required Wells Fargo to remediate compliance failures that had allowed systemic fraudulent practices to occur at the bank. As part of its consent order, the Federal Reserve Board issued an unprecedented asset cap prohibiting Wells Fargo from expanding its assets until it had fully complied with its consent order.
The shareholder complaint—filed in the U.S. District Court for the Southern District of New York on behalf of pension administrators in Mississippi and Rhode Island—alleged that Wells Fargo’s senior executives repeatedly made false and misleading statements to investors regarding the status of Wells Fargo’s compliance with the 2018 consent orders and the timing for lifting the asset cap.
“In fact, the federal regulators repeatedly rejected the bank’s plans,” said law firm Cohen Milstein Sellers & Toll, co-lead counsel for the plaintiffs. “As a result of the bank’s alleged false and misleading statements and omissions, shares of Wells Fargo common stock traded at artificially inflated prices, causing investors to pay more for the stock than it was worth.”
The truth was revealed in March 2020, following a year-long investigation by the House Financial Services Committee, “which concluded that Wells Fargo was not in compliance with the consent orders and had not taken the steps necessary to satisfy its obligations,” the law firm stated.
The preliminary settlement, which is subject to the court’s approval, was first reported by the Wall Street Journal. It follows a long line of other settlements and penalties agreed to by Wells Fargo for poor compliance practices that have included unsafe or unsound practices relating to historical inadequate oversight of sanctions compliance risks, and widespread sales practices misconduct that included opening millions of unauthorized accounts. 
Jaclyn Jaeger is a contributing editor at Compliance Chief 360° and a freelance business writer based in Manchester, New Hampshire.
Wells Fargo trips all over themselves internally. Call one day, get an answer. Call the next day, get a different or conflicting answer. Oh….another…. “Thats not my department” – ok, who’s is it? – “I don’t know”. Or, how about “thats our policy” – when asked if I could see the full policy? – answer, “I don’t know where to find it”
And the beat goes on…. $billion does little to change executive / board leadership, their pay snd behavior!