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Trump says Wells Fargo fines will not be dropped

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Washington (AFP)

US President Donald Trump on Friday said penalties and fines against troubled commercial banking giant Wells Fargo & Co would not be abandoned and could be "substantially increased."

The remarks on Twitter followed a report on Thursday that Trump's pick to lead a key consumer regulatory agency was reviewing whether to press ahead with an enforcement action that could impose tens of millions of dollars in settlement costs on Wells Fargo over alleged abuses in mortgage lending.

"Fines and penalties against Wells Fargo Bank for their bad acts against their customers and others will not be dropped, as has incorrectly been reported, but will be pursued and, if anything, substantially increased," Trump said on Twitter.

"I will cut Regs but make penalties severe when caught cheating!"

Mick Mulvaney, Trump's budget director and interim appointee to run the Consumer Financial Protection Bureau, took control of the agency last month and announced a hiring freeze and review of the agency's litigation.

Created in the wake of the 2008 financial meltdown, the CFPB polices the financial services industry and has made banks and others pay $12 billion in fines and relief for harmed consumers.

The agency took the lead last year in reaching $100 million settlement with Wells Fargo over the millions of sham accounts the bank created in consumers' names without their consent.

But Mulvaney and other conservatives have long attacked the CFPB as example of government overreach and an undue obstacle to commercial activity.

Mulvaney and CFPB Deputy Director Leandra English are currently locked in a legal battle over who controls the agency.

Hours before Mulvaney's appointment by Trump, the CFPB's prior Director Richard Cordray stepped down and named English his deputy in the expectation she would replace him.

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