Warren had little sympathy for Stumpf or his bank, calling his role “gutless leadership”, and asking him to do more than just offer a useless apology.
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She ended with a familiar call: to institute “tough new laws” and install “tough prosecutors” who can ensure jail time for executives, implicitly including Stumpf, and discourage future “scams”, as she called the Wells Fargo practice.
It is worth noting, as MSNBC does, that Warren “is one of the scant few on the Senate banking committee who has not been cut a check by Wells Fargo’s political action committee”.
“You should resign. You should give back the money you took while this scam was going on, and you should be criminally investigated”, Warren said. “This is about responsibility”.
Ultimately, Warren said, Stumpf should resign and a federal investigation into Wells Fargo’s practice should result.
Stumpf, 63, appeared before the Senate banking committee to answer questions following revelations that bank employees secretly opened thousands of fake accounts to meet strict sales quotas. “It runs counter to our vision of helping our customers succeed financially, and it is not representative of Wells Fargo as an institution”, Stumpf said. The company will also call every customer to make sure they are happy with all of the accounts and products they now have with the bank, and it will call every credit card holder to affirm that that credit card holder still wants to stay with Wells Fargo.
Bernie Sanders ripped Wells Fargo following testimony by its CEO over millions of fraudulent accounts opened by bank employees. “A cashier is held accountable, but Wall Street executives who never hold themselves accountable, not now and not in 2008 when they crashed the worldwide economy”, Warren said.
“If you have no opinions on the most massive fraud that’s hit this bank since the beginning of time, how can it be that you get to continue to collect a paycheck?”
So, she said, “let’s do that”, noting Stumpf had repeatedly said “I’m accountable”. Warren is one of the only panel members not to have accepted any contributions from the bank, nor from Stumpf personally.
The company has come under fire for providing incentives to retail bankers to “cross-sell” products to its customers, which critics say encouraged employees to open accounts without permission to meet aggressive internal targets.
Sherrod Brown, the senior Democrat on the senate panel, blasted Wells Fargo for exploiting customers and the bank’s slow response to control the abuse.
Tolstedt announced her retirement in July after amassing salary, bonuses, stock, options and other compensation totaling $124.6 million in her career, Fortune reported, although others placed the figure in the mid-$90 million range.
“A strong performance by Stumpf could mark a positive turning point for the bank”, the report says.
During the hearing, senator after senator expressed astonishment that the creation of unauthorized deposit and credit card accounts by Wells Fargo employees could have gone on for so long without more assertive action by senior management. “This behavior comes from the top at Wells Fargo”.
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“We will do everything we can to make it right by our customers”, he said, but added that the bank is still in the midst of reaching out to customers and it will take time.
