Wells Fargo FAQs: Consent Order Agreement

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Background

In February 2018, we announced we have entered into a consent agreement with the Board of Governors of the Federal Reserve System to improve risk management, compliance and oversight.

We have made much progress in improving risk management and corporate governance, but we recognize there is more work to do. We are committed to meeting the requirements of the new consent order agreement with the Federal Reserve thoroughly and as quickly as possible.

More information can be found in the news release.

Did Wells Fargo do something wrong?

The consent order relates to further improving our board’s governance oversight, and our compliance and operational risk management. This is not the result of new matters. The Federal Reserve indicated last September that they may take actions to ensure the right set of risk and oversight controls are in place following improper sales practices. In the consent order, the Federal Reserve acknowledges the efforts that we’ve taken to improve corporate governance and risk management, but believes there is more work that needs to be done, and we agree. We are continuing the work that is underway.

The Federal Reserve’s order is referred to as a "cease and desist" order. What does that mean? Does Wells Fargo need to stop doing business?

"Cease and desist" is a legal term. In this case, for example, the Federal Reserve has placed restrictions on our asset growth. However, we are still here to serve you and help you with your financial needs.

The consent order mentions that Wells Fargo is limited in growing its assets. Are lines of credit, including credit cards, personal lines, home equity loans, business loans, etc., still available for me to use? Will Wells Fargo be able to lend me money in the future?

Yes. The consent order in no way affects our commitment to you or our ability to meet your current and future banking needs. Although one part of the consent order restricts our company’s asset growth, our strong financial position provides us with flexibility in how we meet that requirement. We remain one of the soundest financial institutions and we continue to have the capacity and ability to serve you.

Are my deposits with Wells Fargo safe?

Yes. We are financially strong and flexible, one of the soundest financial institutions, with strong capital levels. The order in no way affects our commitment to you or our ability to meet your current and future banking needs.

The Consent Order says you can’t grow your assets, but my company will need additional funding to meet our growth plans. Do I need to find a new bank?

No. We will manage our company to meet the requirements of our regulators while ensuring we continue to fulfill our role to customers as a major lender. Wells Fargo has a very strong balance sheet and we will work to minimize the potential impact to our customers. The process for renewing or obtaining new loans and lines of credit remains the same for our customers. We’ll do whatever additional work is necessary behind the scenes to meet our obligations to the Federal Reserve and to our customers.

How long will this consent order stay in effect?

While there is no specific period of time when this consent order will be in effect, we do believe we can meet our requirements by year-end 2018.