Wells Fargo is now under new investigation by the SEC regarding the banks cash sweep feature which allows customers to earn a return on uninvested cash balances.
The cash sweep options include a standard bank deposit sweep, expanded bank deposit sweep and a money market fund sweep.
Eligibility is based on the type of investment account and nature of account ownership, according to the bank.
“The SEC investigation adds to the laundry list of regulatory scrutiny the bank has come under in recent years,” reports BankingDive.
“The lender, which is still working to repair an image damaged by the highly publicized fake accounts scandal that came to light in 2016, has most recently faced criticism over its diverse hiring practices.”
About a dozen current and former employees of the bank told The New York Times in May 2022 that Wells Fargo held phony job interviews for nonwhite and female job-seekers for positions that had already been offered to other candidates.
The Department of Justice closed its investigation into Wells Fargo’s hiring practices without taking action.
However, the SEC is still investigating the matter, the bank also disclosed in its filing on Tuesday.
Other Banking News Today
California is now being hit by another round of massive bank layoffs prior to the holidays according to the latest WARN data.
Bank of Montreal (BMO) is cutting 228 jobs in California’s Bay Area next month, as the Canadian lender continues to shed positions following its February acquisition of San Francisco-based Bank of the West, reports BankingDive.
The cuts will impact 200 jobs at the bank’s office in San Ramon, and an additional 28 at Bank of the West’s former headquarters at 180 Montgomery St. in the city’s financial district, according to the notice, which was filed with the Employment Development Department in California.
BMO agreed to buy Bank of the West from BNP Paribas for $16.3 billion in December 2021. T
he deal, which closed on Feb. 1 this year, created the 13th-largest U.S. commercial bank with roughly $256 billion in assets, according to figures from the Office of the Comptroller of the Currency.
We recognize that this is a challenging time for our colleagues whose roles have been impacted,” a BMO spokesperson said in a statement.
“We are working closely with affected employees to provide support and to ensure they are treated with fairness and respect.”
The cuts, which will take effect Dec. 8, follow a previous round of layoffs the firm made in California in September, when it shed 250 positions in the Bay Area.
The firm has also trimmed staff at offices in Omaha, Nebraska, Thornton, Colorado and Milwaukee, Wisconsin in recent months.
BMO’s capital markets unit in June also cut around 100 positions or 3.5% of the department’s staff amidst a downturn in dealmaking.
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