A $3.5 million fine has been assessed against the former Wells Fargo Bank general counsel in a settlement following charges that he and other executives helped to maintain a business model that urge workers at the bank to engage in “serious misconduct for many years,” the regulator of national banks said Friday.
In a release, the Office of the Comptroller of the Currency (OCC) said the assessment penalty against James Strother, once the bank’s general counsel, was for the role he played in the national bank’s systemic sales practices misconduct. The penalty was part of a settlement reached with Strother, who has also agreed to cooperate with the agency in any investigation, litigation, or administrative proceeding related to sales practices misconduct at the bank.
Also part of the settlement was a personal cease-and-desist order against Strother. That order, among other things, requires him to provide a copy of the order to either his current employer (if a bank or other federally insured financial institution) or to any other bank or financial institution he may become employed by in the future.
In 2017, charges of widespread consumer abuses and other compliance breakdowns were leveled against the bank, which ultimately led to a variety of fines and penalties imposed by federal regulators against the bank and a number of its executives – including a cap on asset growth imposed by the Federal Reserve.
The charges revolved around what regulators called “a systemic and well-known problem with sales practices misconduct that persisted for at least 14 years, beginning no later than 2002.” The “sales practices misconduct” referred to the practices of bank employees issuing a product or service to a customer without the customer’s consent, transferring customer funds without the customer’s consent, or obtaining a customer’s consent by making false or misleading representations, according to filings by the OCC.