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Fed drops hammer on Wells Fargo, board for past misdeeds

Joe Mont | February 5, 2018

On her last day as Federal Reserve Chairman, Janet Yellen dropped a bombshell on the embattled Wells Fargo bank.

“Responding to recent and widespread consumer abuses and other compliance breakdowns by Wells Fargo,” the Federal Reserve Board on Feb. 2 announced that it would restrict the growth of the firm until it sufficiently improves its governance and controls.

Concurrently with the Board's action, Wells Fargo will replace three current board members by April and a fourth board member by the end of the year.

In addition to the growth restriction, the Board's consent cease and desist order with Wells Fargo requires the firm to improve its governance and risk management processes, including strengthening the effectiveness of oversight by its board of directors. Until the firm makes “sufficient improvements,” it will be restricted from growing any larger than its... To get the full story, subscribe now.