Regulation

Mulvaney Puts Wells Fargo’s Fines On Ice – For Now

The Consumer Financial Protection Bureau’s new interim head, Mick Mulvaney, is looking at Wells Fargo’s case to see if it should be on the hook for tens of millions of dollars over mortgage lending abuse, reported Reuters.

The report, citing three sources familiar with the dispute, reported the CFPB has been investigating the mortgage abuse since earlier in the year. In November, the Bureau accepted an internal review from Wells Fargo and set settlement terms. But that case and many others are now being reviewed by Mulvaney, who has been very critical of the government watchdog in the past.

The sources noted that with the settlement – which former CFPB head Richard Cordray signed off on before stepping down – Wells Fargo would pay tens of millions of dollars, but less than the $100 million it paid to the CFPB last year to settle its fake account scandal. Wells Fargo said in September that more than 100,000 borrowers paid a fee to lock in a fixed interest rate on their mortgage loans from September of 2013 through February of 2017, with a “substantial number” of the customers improperly charged.

While a Wells Fargo spokesman declined to comment on the CFPB report, he did tell Reuters that the bank is committed to refunding the wrongful fees back to customers. “Over the next few months, we will be contacting other customers who paid those fees and will provide refunds,” said spokesman Tom Goyda.

Meanwhile, John Czwartacki, an adviser to Mulvaney, told Reuters that his review won’t hurt any eventual settlement deals reached. “Acting director Mulvaney made it clear to staff that any pause should not and will not impact any ongoing negotiations,” he said.

Since taking over the head role for the interim, Mulvaney – a long-time critic of the CFPB and its reach – has instituted a hiring freeze and also halted all new regulations for the next 30 days. He also said last week that he’s looking over more than 100 pending enforcement actions, litigation and settlement talks. While Mulvaney wouldn’t discuss specific cases, he said there are two litigation cases that he had been asked to delay, and also that he has issues with the case against the mortgage company PHH Corporation, although he didn’t expand on those comments.

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