An 18-month review of account opening activities at more than 40 national banks in the wake of the Wells Fargo fiasco identified some 20,000 accounts that were opened under questionable circumstances, Comptroller of the Currency Joseph P. Otting told lawmakers Wednesday.
During his first appearance before the House Financial Services Committee since he took over as head of the Office of the Comptroller of the Currency (OCC), Otting said in response to questions that fewer than 20% of the above-noted accounts were opened without customers’ authorization. No public enforcement action has been taken on any of the involved institutions, Otting said when questioned by Rep. Carolyn Maloney, D-N.Y.
Instead, Otting said, banks flagged for the questionable activity have been issued MRAs (“matters requiring attention”) that task the banks with making improvements in their policies, procedures and controls.
Otting detailed the findings of this “horizontal” review of selected banks in letters to the chairmen and ranking members of the House Financial Services and Senate Banking committees. During the hearing, Maloney pointed to the 250 deficiencies found at the 40 banks that were reviewed, and she questioned whether that didn’t suggest to the OCC that its review should be expanded. (Otting earlier described this review as “conclusive.”)
Maloney also asked the comptroller about the agency’s progress regarding a national charter for financial technology firms, or fintechs. She asked whether this charter would subject fintech firms to the same supervision and regulation that applies to national banks. Fintechs will have the “same supervision as national banks,” he replied.
Otting appeared before the committee to report on activities and priorities at the OCC; he will give similar testimony Thursday before the Senate Banking Committee.
Otting Testimony before House Financial Services Committee (June 13, 2018)