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Wells Fargo says SEC is investigating its hiring practices



(Reuters) — Wells Fargo & Co . said Monday that the US Securities and Exchange Commission has begun investigating its hiring practices, after the Justice Department opened a related investigation.

In its quarterly report filed with the SEC, the fourth-largest U.S. bank said both agencies “have conducted formal or informal inquiries or investigations regarding the company’s employment practices related to diversity.”

Wells Fargo came under scrutiny in June when it scrapped a policy requiring it to interview a “diverse” group of people for certain jobs, with half of the candidates being women or non-white.

The suspension came after The New York Times said the policy had led some employees at the San Francisco-based bank to conduct “fake”

; interviews for jobs that had already been filled.

In reinstating the policy, Wells Fargo said on Aug. 1 that it had interviewed recruiters and recruiters to evaluate ways to improve hiring diversity.

The SEC can prosecute civil cases, while the Department of Justice has criminal enforcement authority.

Wells Fargo also said in Monday’s filing that it is in talks with another federal agency, the Consumer Financial Protection Bureau, to resolve “a number” of investigations, including for auto loans, consumer savings accounts and mortgages.

The bank had set aside $2 billion in the third quarter for legal bills. It estimated its maximum legal exposure beyond reserves was $3.7 billion as of Sept. 30, up from $3.2 billion three months earlier.

An SEC spokeswoman declined to comment. The CFPB did not immediately respond to a request for comment.


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