Wells Fargo reform plans fail to satisfy Fed after scandals: sources

WASHINGTON (Reuters) – The Federal Reserve has rejected Wells Fargo & Co’s (WFC.N) plans to prevent further consumer abuses and told the scandal-plagued lender it needs stronger checks on management, according to three people with knowledge of the discussions.

The concerns raised by the Fed, which have not been previously reported, are likely to increase the time it takes the central bank to lift an asset cap it imposed on Wells Fargo in February following a string of sales practices scandals.

The bank must draw-up a robust plan to improve its governance and risk management controls before the Fed will lift the cap and in February Wells Fargo CEO Tim Sloan said the bank was “on the fast track” to meeting those conditions.

Both the Fed and Wells Fargo declined to comment on the specifics of the review.

Source: Reuters

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