Justice Department Investigates Wells Fargo Wholesale Banking Unit

The Department of Justice in recent weeks has asked more information from the bank to consider whether the pressure from management had prompted employees to inappropriately modify or add information, people said. Employees at the time were working to obtain client documents in order before a regulatory deadline.

Alan Elias, spokesman for Wells Fargo, said the bank was not commenting on regulatory or legal issues. A spokesman for the Justice Department declined to comment.

The Department of Justice is interested in knowing if there is unethical and potentially fraudulent employee behavior behavior related to management pressure, people said. Employees of the wholesale banking unit, on the side of the bank that deals with corporate clients, mismanaged the documents last year and early in the year, the newspaper reported.

This investigation only adds to the problems of Wells Fargo, which has been shattered since the sales scandal in its consumer bank, which imploded two years ago. It also highlights how bad behavior has emerged throughout the bank and continued even after the collapse of sales practices in 2016. The problems of the bank have since been reflected, with problems related to objectives. sales and inadequate client fees in all of its major business units, triggering a wide range of federal and state investigations.

In wholesale banking, the bank's own magazine has revealed in recent months that the problems were more prevalent than previously thought, people said. Problems related to the change of documents initially focused on the wholesale banking sector called the corporate group, which targets companies with annual sales between $ 5 million and $ 20 million. Wells Fargo has encountered similar problems in its commercial banking division, which primarily serves the mid-market companies, and its corporate trust group, which helps administer corporate and government-issued securities.

Elias, of Wells Fargo, said in a statement that "this particular situation involved a new process and a new document to be completed for our team members". He said the bank was taking corrective measures and instituting additional training.

"While this issue has not had a negative impact on our clients, we take all documentation issues seriously and expect appropriate behavior from front-line team members through leaders." , he added. "If we have something wrong, we repair it."

The paper had previously reported that employees had modified client documents, with Wells Fargo scrambling to meet a deadline to comply with a 2015 Office of the Comptroller's Order of Consent. The regulator had ordered the bank to strengthen its anti-money laundering controls, including its processes to ensure that proper identification documents existed and that the bank could see the clients' activities in a common database.

When the OCC issued the consent order, Wells Fargo had more than 100,000 client accounts to audit, the Journal reported earlier. In May, Wells Fargo officially asked OCC for an extension beyond the original June 30, 2018 deadline.

In the past year, the bank has contacted thousands of customers to request up-to-date information on such things as customer addresses or birth dates. Banks must have certain information, known as the "know your customers" regulatory requirements, in order to continue to offer their clients banking services.

Write to Emily Glazer at [email protected]