day, another scandal involving Warren Buffett's favorite bank.
WSJ, the DOJ is now probing whether employees committed
fraud in Wells Fargo’s wholesale banking unit as a after
revelations that employees improperly altered customer
information. This follows a prior WSJ report that some employees
in the unit added information on customer documents, such
as Social Security numbers and dates of birth, without their
the bank’s own review discovered in recent months that in its
wholesale banking group the problems were more widespread than
previously thought: problems with altered documents initially
centered in the part of the wholesale banking business called the
business banking group, which focuses on companies with annual
sales of $5 million to $20 million. Wells
Fargo has found similar problems in its commercial banking
division, which primarily serves middle-market companies, and
its corporate trust services group, which helps with the
administration of securities issued by companies and governments,
one of the people said.
to the Journal, employees altered the customer documents as Wells
Fargo was rushing to meet a deadline to comply with a 2015 consent
order from the Office of the Comptroller of the Currency.
regulator had ordered the bank to beef up its
anti-money-laundering controls, including its processes for
ensuring that there are proper identification documents and that
the bank has the ability to see client activities across a
the OCC issued the consent order, Wells Fargo had more than
100,000 customer accounts it needed to verify, the Journal
previously reported. Wells Fargo in May formally asked the OCC
for an extension beyond the initial June 30, 2018, deadline.
a result, over the past year, the bank has been reaching out to
thousands of clients requesting updated documentation on
information such as relevant client addresses or dates of birth.
Banks must have certain information, known as “know your customer”
regulatory requirements, in order to keep banking their clients.
other words, there was fraud
everywhere, and then there
was fraud to cover up the fraud..
the WSJ adds, the Justice Department is trying to learn if there
is a pattern of unethical and potentially fraudulent employee
to management pressure. The employees
in the wholesale banking unit, the side of the bank that deals
with corporate customers, mishandled
the documents last year and earlier this year.
latest probe adds to the problems at Wells Fargo, whose reputation
has been crushed since a sales scandal in its consumer bank
imploded two years ago.
also underscores how bad behavior has emerged throughout the
bank and has continued even after the 2016 blow-up over sales
practices. The bank’s problems have cascaded since then, with
issues related to lofty sales goals and improper customer
charges emerging across all of its major business units,
prompting a range of other federal and state investigations.
news of the latest probe sent Wells stock tumbling as investors
wonder just how "low can Fargo go."