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Wells Fargo to pay $1B to settle claims of mortgage lending abuses

Bank expects payment to shave $800M from Q1 profits
April 20, 2018 10:35AM

Wells Fargo’s Tim Sloan, Mick Mulvaney (Credit: Getty Images)

Wells Fargo will pay a $1 billion to settle several allegations, including that it improperly charged mortgage customers fees to lock-in interest rates.

The Consumer Financial Protection Bureau and the Office of the Comptroller of the Currency announced the settlement on Friday, following several reports that the agreement was looming, CNBC reported. Back in December, President Trump tweeted that the bank wouldn’t escape penalties linked to the alleged mortgage lending abuse and would perhaps face stiffer fines than expected.

Wells Fargo expects the settlement to shave $800 million off its first-quarter profits, bringing it to $4.7 billion.

“While we have more work to do, these orders affirm that we share the same priorities with our regulators and that we are committed to working with them as we deliver our commitments with focus, accountability, and transparency,” Wells Fargo CEO Tim Sloan said in a statement.

In February, the Federal Reserve restricted the bank’s loan growth until it made changes to its risk management practices. [CNBC] — Kathryn Brenzel