Sen. Sherrod Brown Criticizes Wells Fargo’s ‘Unacceptable’ Behavior

Sen. Sherrod Brown, the chairman of the Senate Banking Committee, said in a letter to Wells Fargo CEO Charles Scharf that the bank has failed to repair its government and risk management problems.

In the letter, Brown complained of a “laundry list” of compliance missteps and consumer abuses.

“It is clear that Wells Fargo still has a long way to go to fix its governance and risk management before it should be allowed to grow in size,” Brown wrote. “It is unacceptable that after years of failed attempts, nothing seems to have improved.”

Brown pointed to a $7 million Securities and Exchange Commission (SEC) penalty the bank paid in May because of violations of anti-money-laundering (AML) regulations between 2017 and 2021.

As PYMNTS reported, the SEC said Wells Fargo had failed to report at least 34 suspicious transactions that could have warranted AML probes.

Read more: Wells Fargo to Pay $7M to Settle SEC AML Allegations

“Due to Wells Fargo Advisors’ deficient implementation and failure to test a new version of its internal anti-money laundering transaction monitoring and alert system adopted in January 2019, the system failed to reconcile the different country codes used to monitor foreign wire transfers,” the SEC said in its report.

In his letter, Brown also cited recent reports in which a former employee claimed the bank had held fake job interviews of Black and female applicants to create a false impression that it was trying to promote a more diverse workplace. Wells Fargo has denied this employee’s allegations.

But Brown said in the letter that Wells Fargo’s failure to deal with alleged lending discrimination and to make its staff more diverse has raised questions about whether it can deal with “myriad internal controls, risk management and general governance issues.”