October 27, 2017 / 4:17 PM / a month ago

U.S. investigating forex trading at Wells Fargo: WSJ

(Reuters) - Federal prosecutors are investigating foreign-exchange trading at Wells Fargo & Co and have subpoenaed information from the firm, the Wall Street Journal reported, citing people familiar with the matter.

FILE PHOTO: A Wells Fargo branch is seen in the Chicago suburb of Evanston, Illinois, U.S. February 10, 2015. REUTERS/Jim Young/File Photo

The investigation, according to the report, relates to a single trade and ensuing dispute with client Restaurant Brands International Inc, owner of Burger King, Tim Horton and Popeye‘s. An email to the company’s press office was not returned.

The investigation, which is in early stages, is being conducted by the U.S. Attorney’s Office for the Northern District of California, the Journal reported. A spokeswoman for that office did not respond to inquiries.

“Wells Fargo learned of an issue associated with a foreign exchange transaction for a single client. The matter was reviewed, the client was promptly notified regarding the issue and Wells Fargo leadership took steps to hold accountable the individuals who were involved,” bank spokeswoman Elise Wilkinson wrote in an email message to Reuters.

Wilkinson said last Friday that four Wells Fargo forex employees, Simon Fowles, Bob Gotelli, Jed Guenther and Michael Schauffler were no longer with the bank.

The third-largest U.S. bank has been trying to recover from a sales scandal over as many as 3.5 million fake accounts created by its employees in an effort to meet aggressive sales targets. The lender has since uncovered other problems, including with auto loans, life insurance and mortgages.

The forex problems are the first indication Wells Fargo’s issues may extend to its institutional businesses, which according to Wells Fargo have seen relatively little impact from the scandal.

Reporting by Dan Freed in New York and Diptendu Lahiri in Bengaluru; Editing by Saumyadeb Chakrabarty and Cynthia Osterman

Our Standards:The Thomson Reuters Trust Principles.
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