Federal regulators are preparing to conduct reviews of the nation’s biggest banks, aiming to root out any of the aggressive cross-selling practices that led to Wells Fargo being fined $185 million for more than 5,000 of the bank’s former employees opening more than 2 million fake accounts to get sales bonuses.
The news comes courtesy of Bloomberg, which reports that the Office of the Comptroller of the Currency and the Consumer Financial Protection Bureau, both of which were involved in the fine against Wells Fargo, are working with the Federal Reserve and the Federal Deposit Insurance Corp. to pursue “on-site” reviews.
Wells Fargo’s largest competitors have received regulators’ formal requests for information and have been preparing for their practices to be scrutinized by examiners in the coming days, said the person, who requested anonymity because the process isn’t public.
CFPB Director Richard Cordray said his agency will “follow up aggressively” with the rest of the industry, but indicated at the Senate hearing that he doesn’t expect to find the same level of problems as at Wells Fargo, where employees were pushed to open multiple accounts for customers.
“Wells Fargo bank no doubt was the industry leader in aggressively cross-selling products, which led in part to the extreme circumstances we find here,” he said to lawmakers.
But that isn’t stopping the federal agencies from looking into the big banks’ practices. Buckle up.