Wells Fargo revealed on Thursday in a quarterly filing with the Securities and Exchange Commission that it is under “inquiries or investigations” by “government authorities” concerning its anti-money laundering and sanctions programs.
The filing did not specify which agencies are conducting the investigations or provide further details. This disclosure is new, as it was absent from the “Legal Actions” section of Wells Fargo’s first-quarter SEC filing.
A Wells Fargo spokesperson declined to comment beyond the information provided in the filing.
While inquiries and investigations do not necessarily lead to penalties or enforcement actions, they can indicate underlying concerns.
Late July and early August are insightful periods for keen observers of the banking sector. During this time, banks typically release their second-quarter SEC filings, which can provide hints (though often scant details) about the expectations of major financial institutions for the upcoming weeks and months.
For instance, HSBC disclosed in its quarterly SEC filing this week that its U.S. arm is no longer under investigation by the Department of Housing and Urban Development for redlining.
Subtle changes in language from one quarter to the next can help investors monitor the progress of ongoing issues, such as the SEC's penalties related to WhatsApp communications and inadequate record-keeping.
Last year, various banks used their second-quarter SEC filings to estimate the amounts they would pay into the Deposit Insurance Fund following the failures of Signature, First Republic, and Silicon Valley Bank.
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