Chairwoman Maxine Waters Applauds CFPB's Crackdown on Repeat Offender, Wells Fargo

Statement

Today, Congresswoman Maxine Waters (D-CA), Chairwoman of the House Committee on Financial Services, released the statement below following news that the Consumer Financial Protection Bureau (CFPB) ordered Wells Fargo Bank to pay $3.7 billion for widespread consumer fraud and abuse.
"I am very pleased that the Consumer Financial Protection Bureau, under the leadership of Director Rohit Chopra, has cracked down on Wells Fargo's ongoing pattern of repeated violations with serious penalties for harming more than 16 million consumers beginning more than a decade ago and continuing up until this year. The CFPB's order lists numerous violations, including shoddy auto loan servicing resulting in excessive fees or even wrongful vehicle repossessions, for which the bank had to provide $1.3 billion in remediation to over 11 million harmed consumers. Wells Fargo also denied thousands of struggling homeowners a mortgage modification, sometimes resulting in wrongful foreclosure. The bank also inappropriately charged surprise overdraft fees and froze more than 1 million accounts, preventing consumers from accessing their own funds, perhaps when they urgently needed it. In total, Wells Fargo is required to pay $2 billion in redress to harmed consumers, in addition to $1.7 billion in penalties, and it is also required to take specific steps to curb their behavior, including halting surprise overdraft fees and using alternative measures when fraud is suspected instead of fully freezing accounts.

"As Chairwoman of the Committee on Financial Services, I have sounded the alarm about repeat offenders like Wells Fargo. I have held multiple hearings to force Wells Fargo's CEO and other megabank CEOs to answer to the public for their actions. I am disturbed by the fact that some violations in this order occurred or continued since September 2019 when Wells Fargo came under new leadership, which leads me to believe that much, much more needs to be done to rein in Wells Fargo.

"Furthermore, I remain concerned that the standard fines repeat offenders have been slapped with in the past amount to the cost of doing business while they rake in profits. Accordingly, I am pleased that Director Chopra said that the CFPB's announced penalties were just a first step, and that regulators should consider imposing additional limitations on the bank beyond the asset cap imposed by the Fed in 2018. Similarly, I have proposed legislation, the "Repeat Offenders, Megabanks, and Credit Bureaus Accountability Act," to require, among other things, an interagency, strategic approach on how regulators should deploy their existing authority to escalate enforcement actions, beyond the typical fines, to hold repeat offenders like Wells Fargo accountable.

"At a time when the fundamental structure of the CFPB and the validity of its regulations are being challenged by a radical opinion from the Fifth Circuit Court, today's announcement from CFPB reminds us of the importance of CFPB in protecting consumers across the country. I applaud Director Chopra for this action and I look forward to other regulators joining him to take further actions to hold Wells Fargo accountable."

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