In addition to Warren, who this week called for the resignation of Wells Fargo Chief Executive John Stumpf, the letter was signed by Democrats Sherrod Brown of Ohio, Jack Reed of Rhode Island, Robert Menendez of New Jersey, Jeff Merkley of Oregon, Kirsten Gillibrand of NY and Mazie Hirono of Hawaii.
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Specifically, the senators asked the department’s Wage and Hour Division to make an inquiry into whether Wells Fargo “aggressively skirted” overtime laws and failed to properly compensate bank tellers and associates who worked long hours to meet their sales quotas, or salaried bank associates misclassified as overtime-exempt officers.
Wells Fargo recently made a $185 million settlement after authorities reported illegal cross-selling to millions of customers who were enrolled in programs – credit cards, savings accounts, other products – without the customers’ knowledge.
US Senate lawmakers excoriated Wells Fargo & Co.’s chief for his oversight of the bank as it opened two million bogus customer accounts, potentially laying the groundwork for new rules and reviving questions of whether banks are “too big to fail”.
Separately, Stumpf resigned from his position on the Federal Advisory Council effective today, the San Francisco Federal Reserve Bank told ABC News. On Thursday, Angus King, an independent senator from ME, sent the San Francisco Fed a letter urging it not to reappoint Mr Stumpf to the FAC panel. The employees created the fraudulent accounts to meet bank quotas and were allegedly threatened with firing if they didn’t comply.
“It would be ironic if the Federal Reserve … continued to receive special insights and recommendations from senior management of a financial institution that just paid a record-breaking fine to the Consumer Financial Protection Bureau for “unfair” and “abusive” practices that placed consumers at financial risk”, the letter read.
The letter was signed by Massachusetts Sen.
Stumpf has also been called to testify at a hearing of the House Financial Services Committee next Thursday. But many lawmakers are asking that Stumpf and other executives be held accountable. Another group of Senate Democrats called on the Labor Department Thursday to open its own probe into the treatment of employees at the bank. The council is filled with one member of the banking industry picked by each of the 12 regional Fed banks. Representatives on the council are appointed to one-year terms, and a search for Stumpf’s replacement is already underway.
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This story was updated at 5:02 p.m.
