The elimination of the sales goals “represents another step to reinforce our service culture, helps ensure that nothing gets in the way of our ability to achieve our mission, and is consistent with our commitment to providing a great place to work”, he said.
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Shares of Wells Fargo fell 0.9% to 46.52 on the stock market today.
Prosecutors are also focusing on whether there was willful blindness to sales practices on the part of executives at the bank, these people said.
Wells Fargo built itself into the most valuable United States bank after the financial crisis, partly because it did not rely on risky trades or complex derivatives to turn a profit.
Wells Fargo is completely eliminating sales goals in retail banking in an attempt to take away the incentive for workers to create fake accounts using customer information. “When we fall short of that goal, I feel accountable and our leadership team feels accountable-and we want all our stakeholders to know that”.
Olen said Stumpf’s denials “could come back to bite him” if the Securities and Exchange Commission decides to investigate Wells Fargo and finds evidence that contradicts his claims. The phony account practice yielded only $2.4 million in fees for Wells Fargo, which generated $86 billion in revenue previous year, and is unlikely to trigger a material restatement.
Wells Fargo Chief Executive John Stumpf will testify along with the heads of the Consumer Financial Protection Bureau and the Office of the Comptroller of the Currency, the two regulators that joined Feuer’s office in announcing the settlements last week. “Employees who do not reach their quotas are often required to work hours beyond their typical work schedule without being compensated for that extra work time, and/or are threatened with termination”.
Stumpf even sent out a note to all Wells Fargo customers saying, “Every day we strive to get things right”. Consider that in 2014, around the middle of the roughly five-year period reviewed by the CFPB, Wells Fargo set a record in reporting net income of $23.1 billion, on revenue of $84.3 billion.
Treasury Secretary Jacob J. Lew on Tuesday said Wells Fargo’s “bad behavior” was unacceptable.
As for whether or not Buffett will pull out of Wells Fargo, a company he ardently supported over the years, Schiffer thinks the wealthy venture capitalist is in it for the long haul.
The investigation comes a week after Wells Fargo (WFC), one of the nation’s largest banks, was hit with $185 million in civil penalties for secretly opening millions of unauthorized deposit and credit card accounts that harmed thousands of customers.
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“We have made it clear we don’t believe anybody is too big to jail”, Lew said at a New York City conference.
