Elizabeth Warren Urges Fed to Reject Wells Fargo Appeal

Senator Elizabeth Warren (D-MA) has urged the Federal Reserve to reject Wells Fargo's request to lift its $1.95 trillion asset cap, imposed in 2018 due to the bank's history of mismanagement and consumer abuses. In a letter to Fed Chair Jerome Powell, Warren emphasized that Wells Fargo has not demonstrated significant improvements in its risk management and compliance, as evidenced by recent enforcement actions against the bank. She criticized the bank's reliance on a third-party report, pointing out that this analysis was submitted shortly after a major enforcement action by the Office of the Comptroller of the Currency. Warren highlighted that any decision to lift the cap must be made by a vote of the full Federal Reserve Board, reiterating that the bank needs to show it can effectively manage risks before such a decision is made. The Fed has the authority to request further information or progress from Wells Fargo regarding its compliance efforts. With the upcoming presidential administration potentially favoring deregulation, Warren's stance aims to maintain scrutiny over the bank's practices.