Wells Fargo will face an enforcement action by New York state over the bank’s alleged failure to uphold terms of a $25bn mortgage-servicing settlement, a person familiar with the matter said.
Bloomberg reports that the action, in the form of a motion to compel compliance with the 2012 accord, is to be filed by New York Attorney General Eric Schneiderman in federal court in Washington, said the person, who asked not to be identified because the matter isn’t public.
Wells Fargo and Bank of America were accused by Schneiderman’s office of violating the national settlement, under which five of the country’s largest mortgage servicers promised to reform foreclosure and loan-modification practices.
Bank of America has agreed to changes aimed at bringing the Charlotte, North Carolina-based lender into compliance with the deal, according to the person. San Francisco-based Wells Fargo hasn’t agreed to any changes, the person said.
The practices Bank of America agreed to change to bring itself in line with the settlement apply in New York only, although the bank is expected to try to expand those reforms nationwide, the person said.
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