Shares of Wells Fargo (WFC) closed lower on Thursday as Goldman Sachs analysts said the San Francisco-based bank could owe less than $50 million if it were to reimburse customers who were harmed by the more than 2 million illegal account openings.
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The Senate Banking Committee launched a probe into the company’s practices after millions of Wells Fargo accounts were opened without the consent of customers, reportedly to meet the bank’s aggressive sales goals.
In a feverish drive to meet sales targets, bank employees opened the unauthorized accounts, transferred customers’ money into them, and signed people up for online banking, according to the regulators. He reached out to Wells Fargo’s human resources in September 2013, but was terminated barely a week later. Its members customarily serve three one-year terms.
“John made a personal decision to resign as the Twelfth District’s representative to the Federal Advisory Council”, Wells spokesman Mark Folk said.
Timothy Sloan, a Wells Fargo banker who was promoted from the CFO role to president and COO, was once considered a likely candidate to replace Stumpf.
Sens. Elizabeth Warren, D-Mass., Sherrod Brown, D-Ohio, Jack Reed, D-R.I., Robert Menendez, D-N.J., Bernie Sanders, I-Vt., Jeff Merkley, D-Ore., Kirsten Gillibrand, D-N.Y., and Mazie Hirono, D-Hawaii, sent the letter two days after many of them grilled Stumpf for almost three hours in a Senate Banking Committee hearing on Capitol Hill.
News reports indicating that the bank fired more than 5,000 employees as a result of this conduct demand a further investigation into how such a widespread scheme could proliferate unnoticed by management.
Stumpf said: “I accept full responsibility for all unethical sales practices in our retail banking business, and I am fully committed to doing everything possible to fix this issue, strengthen our culture, and take the necessary actions to restore our customers’ trust”. It will also pay restitution to affected customers.
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After his public shaming at the hands of Elizabeth Warren this week, Wells Fargo CEO John Stumpf is stepping down – no, not as chief executive (despite Warren’s wishes). Stumpf’s second term would have ended at the end of this year.
