Wells Fargo is no longer subject to two consent orders following an action by the Federal Reserve.
Wells Fargo Consent Orders Terminated, but Some Remain
After years of regulatory scrutiny, Wells Fargo has seen significant progress in addressing its past misconduct, with most consent orders against the bank being terminated. Since 2019, thirteen consent orders have been lifted, with seven of those happening in 2025 alone.
One of the most notable terminations was the removal of the Federal Reserve's asset cap in June 2025, a restriction that had been imposed since 2018 following the fake accounts scandal. This decision reflects the bank's substantial progress in addressing regulatory deficiencies, improving compliance, risk controls, and governance under CEO Charlie Scharf's leadership.
However, some regulatory agreements still remain in effect. Wells Fargo continues to operate under certain formal agreements with regulators, such as the OCC, relating to anti-money-laundering controls and compliance with the Gramm-Leach-Bliley Act. These outstanding orders have not been terminated because the bank is still working to satisfy the requirements associated with those specific enforcement actions.
The first terminated consent order concerned Wells' legacy mortgage servicing activities, an issue that also affected nine other institutions in 2011, representing 65% of the servicing industry. The Consumer Financial Protection Bureau dropped a 2022 consent order against Wells Fargo regarding automobile and mortgage lending and consumer deposit accounts just one week prior.
The second terminated consent order touched Wells Fargo's legacy Wells Fargo Financial business. It alleged that the bank steered potential prime borrowers into more costly subprime loans and separately falsified income information in mortgage applications.
Analysts at RBC Capital Markets predict the remaining order to be lifted in 2025, potentially in the first half of the year. The termination or dropping of many consent orders has been driven by Wells Fargo fulfilling the conditions set by regulators, including improving internal controls, governance, risk management processes, and demonstrating ongoing remediation of previous regulatory failings.
CEO Charlie Scharf stated that the terminations are an important sign of progress in resolving historical matters. However, the bank's board of directors, in a securities filing, did not mention any specific details about the progress made in resolving these matters. The bank's board of directors credited CEO Scharf's leadership for making "significant progress" in strengthening Wells' risk and control infrastructure.
Despite the terminations, the asset cap for Wells Fargo remains unaffected. The 2018 Federal Reserve action established a $1.95 trillion asset cap for Wells Fargo, which has cost the bank $36 billion in profits, according to a Bloomberg report from Monday. The bank's board of directors, in the same filing, did not mention any changes in the bank's retail operations or regulations and policy.
No further comment was given by a spokesperson for Wells Fargo regarding the terminations. Analysts Gerard Cassidy and Thomas Leddy stated that the terminations are a positive for Wells Fargo & Company. The bank's board of directors, in the securities filing, did not mention any changes in the number of consent orders Wells Fargo is still subject to. The securities filing also did not provide any information about potential purchases of licensing rights.
In summary, while most consent orders against Wells Fargo have been terminated, some regulatory actions remain in place until further compliance milestones are met. The terminations are a significant step forward for the bank, but it still faces ongoing regulatory scrutiny and compliance requirements.
- Wells Fargo has made significant progress in addressing regulatory deficiencies, specifically in the finance sector, as illustrated by the termination of several business-related consent orders.
- Despite the termination of numerous consent orders, Wells Fargo still operates under certain regulatory agreements, specifically in terms of anti-money-laundering controls and compliance with the Gramm-Leach-Bliley Act, which are directly related to the business operations of the bank.
