Office of the Comptroller of the Currency imposes USD 18.5 million in penalties and personal orders on three former Wells Fargo executives over sales practices misconduct

The Office of the Comptroller of the Currency issued two written decisions imposing civil money penalties and personal orders on three former senior executives of Wells Fargo Bank, N.A. for unsafe or unsound banking practices tied to the bank’s systemic and widespread sales practices misconduct. The actions impose a prohibition order and a USD 10,000,000 civil money penalty on former Community Bank Group Risk Officer Claudia Russ Anderson, and personal cease-and-desist orders with penalties of USD 7,000,000 and USD 1,500,000 on former Chief Auditor David Julian and former Executive Audit Director Paul McLinko. From 2013 to 2016, the decision found Anderson failed to credibly challenge the bank’s incentive compensation program, did not institute effective controls to manage risks from the misconduct, failed to escalate known or obvious risks, and repeatedly and consistently downplayed the misconduct. It also noted violations of law based on failing to provide information or providing false, incomplete, or misleading information to the OCC during 2015 examinations. A separate decision concluded Julian and McLinko failed to plan and manage audit activity to detect and document the misconduct and failed to adequately escalate it, and that McLinko did not maintain professional independence from the Community Bank. The orders stem from the OCC’s notices of charges filed in January 2020 and follow recommended decisions issued by an Administrative Law Judge in December 2022 after a 38-day administrative hearing. They are the remaining outstanding actions among those the OCC pursued against 11 individuals, following prior resolutions with eight former Wells Fargo senior executives that resulted in civil money penalties totaling USD 43,175,000.