WASHINGTON Nov 22 A U.S. banking regulator is
considering whether to harden sanctions against lenders that
abuse their clients or violate banking laws, according to a
draft plan, seen by Reuters, that was drawn up in the wake of a
scandal at Wells Fargo.
Wells Fargo in September agreed to pay $190 million to
settle charges that bank employees opened as many as 2 million
accounts without customers' knowledge. The fraud went on for at
least five years, said the San Francisco-based bank that fired
5,300 employees involved.
The Office of the Comptroller of the Currency - the chief
regulator for national banks - waived its right to curb
executive payouts, screen new leadership and other controls at
Wells Fargo following the scandal.
But, according to a memo outlining the new policy, the
agency expects tougher scrutiny on when to issue such exemptions
in the future and senior officials should be involved in any
The memo said that officials with the agency should not
waive sanctions "until appropriate OCC personnel have conducted
a case-by-case evaluation about whether granting such relief is
In recent years, other national lenders such as Bank of
America and Citibank have been granted exemptions similar to
those Wells Fargo received.
Until a thorough, written policy is developed by the OCC,
officials should refrain from granting relief from the toughest
sanctions permitted, according to the memo dated November 18.
An OCC spokesperson was not immediately available for
On Friday, the OCC voided the exemptions that it had
originally granted Wells Fargo in a September settlement.
(Reporting By Patrick Rucker; Editing by Simon Cameron-Moore)