Powell, who worked with Scharf at Bank One and then JPMorgan Chase & Co, most recently was chief executive officer of Santander Holdings USA Inc, as well as of Santander Consumer USA Holdings Inc.
Starting Dec. 9, Powell will focus on Wells Fargo's relationships with regulators, which have been strained since the bank became tangled in a wide-ranging sales practices scandal in 2016.
The San Francisco-based bank is currently operating under more than a dozen regulatory consent orders, including an unprecedented growth restriction on its balance sheet from the Federal Reserve until the bank proves it has fixed its risk controls. Additionally, Wells Fargo faces federal probes by the Department of Justice, the Securities and Exchange Commision and the Department of Labor.
"I wouldn't count on any quick wins," Powell told Reuters by telephone. "This is tough stuff, but it's all very doable over time."
During his tenure at Santander US, Powell was credited with turning around the bank's financials and fixing regulatory issues, experience he said will help him in his new role.
Last month the bank hired another former JP Morgan executive and previous White House official, William Daley, to head public affairs.
Wells Fargo's board set a goal of hiring an outsider to lead the company following former CEO Tim Sloan's retirement to satisfy critics who claimed an insider could not transform the bank's culture.
Scharf, who joined in October from Bank of New York Mellon Corp, is known to shake up leadership. Since he took over, general counsel and former interim CEO Allen Parker, and company veteran Avid Modjtabai have made plans to leave.
The chief operating officer position has been vacant since October 2016, when Sloan was promoted as CEO.
Powell, like Scharf, will be based in New York. He will earn an annual base salary of $1.75 million (£1.36 million) and get a $3.2 million signing bonus, according to filings.
By Imani Moise and C Nivedita