Tough Times
Two striking enforcement actions in the last week or so signal that, for all the talk of relaxed supervision by Trump Administration appointees, the banking agencies will take strong action when they believe bad actions warrant more than a confidential rebuke. Wells Fargo’s manifold embarrassments did lead to putative Fed action in 2018 (see Client Report CORPGOV26), but most supervisory discourse since then has been focused on crafting the new model espoused by FRB Vice Chairman Quarles that still languishes in the bowels of Fed decision-making. Now, we’ve seen two high-profile actions in such very short order that one wonders if the banking agencies are buffing up their toughness credibility ahead of sharp questioning should Democrats take charge after the election.