On March 17, a top U.S. banking regulator terminated a 2021 consent order against Wells Fargo concerning deficiencies in its home lending loss mitigation practices, as reported by the Wall Street institution on Monday. This development brings Wells Fargo closer to resolving longstanding regulatory issues dating back nearly a decade.
CEO Charlie Scharf stated that this action is the fifth closed consent order since the outset of 2025, which includes enforcement measures such as fines or specific directives to rectify identified issues.
In 2021, the U.S. Office of the Comptroller of the Currency (OCC) imposed a $250 million fine on Wells Fargo for issues related to its home lending loss mitigation program and non-compliance with a 2018 consent order.
Wells Fargo's compliance challenges gained prominence following a scandal involving fake accounts in 2016. Under Scharf's leadership since 2019, tackling compliance issues has been a primary focus, resulting in the closure of 11 consent orders to date.
Despite progress, the bank still operates under three outstanding consent orders, including one imposed by the Federal Reserve in 2018, which restricts its growth until regulators are satisfied that the issues have been adequately addressed.
Wells Fargo's shares saw a 0.2% increase in after-hours trading.
In recent months, Wells Fargo has witnessed several regulatory agencies lifting enforcement actions. In January, the Consumer Financial Protection Bureau closed a case related to alleged mishandling of auto loans and mortgages.
In February, the Federal Reserve took action related to a matter dating back to 2011. Additionally, last month, the OCC terminated a 2018 order concerning the bank's compliance risk management.
Analysts at Piper Sandler noted that these developments signal Wells Fargo's shift from a defensive position to an offensive one, possibly boosting investor confidence in the eventual removal of the asset cap.
Scharf expressed optimism, stating, "We are confident that we will successfully fulfill the requirements of our outstanding consent orders."