Trump says Wells penalties will stand
WASHINGTON—President Trump on Friday denied a report that the federal consumer financial watchdog might drop sanctions against Wells Fargo & Co. for alleged mortgage lending abuses and said the bank could face even tougher penalties.
Trump’s response was to a Reuters report that Mick Mulvaney — installed last month as acting director of the independent Consumer Financial Protection Bureau — was reviewing whether the San Francisco bank should pay tens of millions of dollars in penalties for charging fees to certain home buyers to secure low mortgage rates.
On Twitter, Trump said “fines and penalties against Wells Fargo Bank for their bad acts against their customers and others will not be dropped” and declared the Reuters report incorrect. If anything, he said, fines and penalties will be “substantially increased.”
He renewed his promise to cut regulations, which he and congressional Republicans have been doing in recent months, but said he would “make penalties severe” when companies are “caught cheating.”
Representative of Mulvaney and Wells Fargo did not respond to requests for comment.
The consumer bureau was created in 2010 by the Dodd-Frank Act and is designed to be an independent agency free from presidential interference. The president appoints the director, who also needs confirmation from the Senate and then cannot be removed except for cause during a five-year term.
The bureau’s first director, Richard Cordray, resigned Nov. 24. He promoted his chief of staff, Leandra English, to deputy director and said she would be acting director under a Dodd-Frank provision.
Within hours of Cordray’s resignation announcement, Trump appointed Mulvaney to fill the post under the Federal Vacancies Act of 1998. That set off a legal battle. On Wednesday, English asked a federal judge for an injunction to install her as the agency’s acting chief instead of Mulvaney.
U.S. District Judge Timothy J. Kelly denied English’s request last week for a temporary restraining order to remove Mulvaney.
Wells Fargo has been under fire for a series of scandals, including creating millions of accounts in customers’ names without those customers’ knowledge or consent. It also has been accused of forcing autoloan customers into unneeded insurance policies and charging improper fees to some mortgage borrowers.
Reuters reported Thursday that the consumer bureau had accepted an internal review from Wells Fargo and set settlement terms in early November. But that matter and about a dozen others were now in question, it said, because Mulvaney said he was reviewing the bureau’s work.