Labor Department probing Wells 401(k) plan; Envestnet weighs takeover interest

TOP NEWS IN BANKING & FINANCIAL SERVICES

* Federal agencies, including the Labor Department, are probing Wells Fargo & Co.'s 401(k) plan, the San Francisco-based bank disclosed in a regulatory filing. Wells Fargo said the agencies are reviewing certain transactions associated with the employee stock ownership feature of its 401(k) plan, including how certain securities are bought for use in connection with the company's contributions to the plan.

* Envestnet Inc. received takeover interest from a private equity firm, and the Chicago-based financial technology company is thinking it over, although no transaction is imminent yet, Bloomberg News reported, citing people familiar with the matter.

➤ Fla. homeowners insurers see large unfavorable reserve development through Q3'21

Homeowners insurers focused on the Florida market saw a surge in unfavorable prior-year reserve development in the first three quarters of 2021.

➤ Nordea, Danske to continue reducing staff amid digitalization push

Nordic lenders Nordea Bank Abp and Danske Bank A/S will continue to reduce staff in the coming years as they further digitalize their operations.

BANKING

* Wells Fargo is facing a class-action suit from an African American homebuyer named Christopher Williams, who accuses the bank of racial discrimination and violating the Equal Credit Opportunity Act with its mortgage origination and underwriting practices, American Banker reported, citing a case filed in the U.S. District Court for the Northern District of California.

* The Office of the Comptroller of the Currency and the Consumer Financial Protection Bureau are probing Bank of America Corp. for its role in administering government benefits under California's jobless benefits program, American Banker reported, citing anonymous sources. Bank of America is California's exclusive provider of prepaid debit cards to unemployment, disability and pandemic-relief beneficiaries. Lawsuits against the bank reportedly allege that it failed to respond to tens of thousands of cardholders who reported unauthorized transactions that blocked legitimate beneficiaries from accessing their accounts.

* The Canadian government ordered banks to release the frozen accounts of protesters who rallied against COVID-19 vaccines and restrictions in Ottawa for three weeks, The Wall Street Journal reported, citing a statement to lawmakers from Isabelle Jacques, a senior official in Canada's finance department. Prime Minister Justin Trudeau had the protesters' accounts frozen through emergency powers to stop the protest over the weekend.

FINANCIAL SERVICES

* A London court will start hearing today a $1.7 billion lawsuit launched by Nigeria against JPMorgan Chase & Co. for its role in a disputed 2011 oilfield deal, Reuters reported, citing a civil suit filed in the English courts in 2017.

* Following its planned acquisition of Technisys SA, SoFi Technologies Inc. expects to build a cloud-native core banking platform that enables regional and community banks to develop more digital products, executives said on an investor call.

* Former The Goldman Sachs Group Inc. banker Roger Ng testified before a jury that ex-Goldman chief Lloyd Blankfein met in 2009 with then Malaysian prime minister Najib Razak ahead of the 1MDB deal, Bloomberg News reported. Former Goldman's Southeast Asia chairman Tim Leissner told the jury that meeting's agenda was to get Razak's children jobs at the bank, according to the report.

* The Financial Industry Regulatory Authority barred from the industry former Morgan Stanley broker Darryl Cohen for allegedly cheating professional athletes who entrusted the broker supposedly for financial advice, The New York Times reported. Morgan Stanley terminated Cohen in March 2021 due to alleged transactions undisclosed and unauthorized by the company, the report said, citing a regulatory filing.

* Intercontinental Exchange Inc. is making a strategic investment in tZERO Group Inc., a liquidity platform and blockchain technology provider, that will result in the exchange operator being a significant minority shareholder in tZERO.

POLICY AND REGULATION

* The Office of the Comptroller of the Currency issued answers to frequently asked questions regarding the final rule to rescind the June 2020 Community Reinvestment Act rule.

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