OCC Terminates Mortgage Servicing-Related Order Against Wells Fargo

Posted by Patrick Barnard on May 25, 2016 No Comments

The Office of the Comptroller of the Currency (OCC) has terminated its mortgage servicing-related order against Wells Fargo Bank, having found that the bank is now in full compliance with the order.

To conclude the matter, Wells Fargo will pay a $70 million fine in connection with previous violations of the order.

In April 2011, the OCC issued separate consent orders for 12 different banks that were found to be in violation of consumer rights rules related to mortgage servicing that were established following the financial crisis that began in 2008. The consent orders were amended in February 2013 and June 2015.

In the case of Wells Fargo, the OCC found that the bank had failed to correct deficiencies identified in the 2011 consent orders in a timely fashion. As a result, the OCC determined that Wells Fargo violated the 2011 consent order from Oct. 1, 2014, through Aug. 31, 2015, according to a press release.

The OCC further found that, between Dec. 1, 2011, and March 31, 2015, Wells Fargo filed payment change notices in bankruptcy courts that did not comply with bankruptcy rules and safe and sound banking practices.

The OCC also found that, between March 2013 and October 2014, Wells Fargo made escrow calculation errors that in some cases led to incorrect loan modification denials and constituted unsafe or unsound banking practices.

Wells Fargo will pay the assessed penalty to the U.S. Treasury.

In January, JPMorgan Chase Bank and EverBank paid fines of $48 million and $1 million, respectively, to settle violations of consent orders issued by the OCC.

As a result, the OCC terminated the consent orders against these banks, as well.

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