Banking

Irish Central Bank Fines Wells Fargo 5.9M Euros

Ireland’s central bank has fined Wells Fargo 5.9 million euros, according to a report by Reuters.

The fine is the second biggest ever issued by the bank, and it’s for five breaches that happened between 2014 and 2019, which include failure to report the bank’s capital position, which brought to light “serious and systemic weaknesses” in its reporting.

Other breaches include the bank not properly documenting its procedures, and a lack of senior oversight. The bank also failed to comply with regulatory requirements involving liquidity testing.

Wells Fargo said it has vastly improved its reporting processes since the breaches came to light, and that it takes its regulatory obligations very seriously. Wells Fargo has been dealing with issues in the U.S. as well — recently with a scandal involving fake accounts.

The bank has dealt with billions in fines and its balance sheet was capped by the Federal Reserve. Wells Fargo’s Irish incorporated business serves all of Europe, and it has branches in Frankfurt and London. The Irish Central Bank said Wells Fargo had turnover of $586 million in 2018.

“It is a minimum requirement of being regulated by the Central Bank that firms submit accurate and timely regulatory returns,” Director of Enforcement Seana Cunningham said in a statement. “This enforcement action refers to failings in relation to both capital reporting and liquidity testing. For that reason it is considered to be particularly serious.”

The central bank said Wells Fargo’s IT systems were weak and needed a lot of manual adjustments, which led to some incorrect calculations. The regulator said Wells Fargo didn’t finish the remedial steps it needed to take in 2017, but has since done so.

The 5.9 million euro penalty is second only to a 21 million euro fine on Irish lender Permanent TSP. That fine was for the overcharging of mortgage customers. JPMorgan was also recently fined 1.6 million for its breaches in relations to outsourcing.

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