The OCC, in December 2017, completed a review of sales practices at more than 40 banks disclosing several instances of unauthorized account openings, American Banker reported, citing OCC spokesman Bryan Hubbard.
The probe comes after Wells Fargo & Co. was fined $185 million by regulators for opening fraudulent savings and checking accounts on behalf of the company’s clients without their consent.
Following the completion of the review, the agency sent out final letters to participating banks earlier in 2018. The OCC has not publicly released the findings of its review and does not plan to do so, Hubbard said.
In response to American Banker's questions, Hubbard said the most common factors for opening bank accounts without proof of customer consent at certain banks were short-term sales promotions without enough risk controls, inadequate account opening and closing procedures, and isolated incidents of an employee's misconduct.
Hubbard said the OCC's review identified weaknesses in the way few banks approached risk governance over sales practices, prior to the 2016 enforcement action against Wells Fargo. However, most banks took timely actions during the review to deal with deficiencies in policies, procedures, and controls; incentive programs; and risk governance frameworks, and are now better equipped to identify improper sales activities, he added.
Dan Ryan, who leads the banking practice at PricewaterhouseCoopers and was briefed on the OCC's findings, reportedly told the publication that the regulator issued a total of 252 Matters Requiring Attention, or MRA, notices to banks that were under scrutiny for sales practices. MRAs focus on bank practices that are deemed deficient by examiners and banks are expected to take certain corrective actions to resolve the situation.
The OCC also issued five industry-wide MRAs, Ryan added, without disclosing the specific issues mentioned therein, according to the report.
Besides Wells Fargo, major banks regulated by the OCC include Bank of America Corp., Citigroup Inc., JPMorgan Chase & Co., PNC Financial Services Group Inc., Capital One Financial Corp. and U.S. Bancorp.
