John Stumpf told the Senate Banking Committee on Tuesday the bank will contact all deposit customers in the US, including those who already had fees refunded, to invite them to review their accounts with their banker. Stump indicated Tolstedt was pushed out after the bank determined she “did not do enough” to fix issues in the retail bank. Previously the bank had only agreed to do that for its California customers, as part a settlement with Los Angeles.
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“I am deeply sorry that we failed to fulfill our responsibility to our customers, to our team members and to the American public”, Stumpf said in the prepared remarks. When Stumpf testifies before a Senate committee hearing Tuesday, Sept. 20, 2016, it won’t be just his bank under fire for turning friendly branches into high-pressure sales centers. “I accept full responsibility for all unethical sales practices in our retail banking business”.
A series of YouTube videos spoofing how Wells Fargo bankers relentlessly pushed lots of products on customers are getting new life online.
The panel is expected to pinpoint Stumpf’s role in managing the bank, including finding out what checks and balances, if any, he put in place to monitor if his employees were abusing customers.
Stumpf has refused to step down, despite calls for him to do so.
Clinton, who faced accusations during her party’s primary elections of representing Wall Street’s interests, said in the letter that Stumpf “owes all of you a clear explanation as to how this happened under his watch”.
About 5,300 Wells Fargo employees were fired in connection to the allegations.
Stumpf reiterated that “managers and managers of managers” were fired, and for the first time said at least one “area president” was also terminated.
Khalid Taha, who moved to the USA from Syria in 2011, said he faced “unreasonable” sales quotas as a personal banker at Wells Fargo in San Diego, a job he held until July.
“A poor performance could intensify calls for Stumpf’s resignation, causing further pressure” on Wells Fargo, Edward Mills, a policy analyst for FBR & Co., wrote in a research note Monday. If he was unaware of the problems, critics could seize on that as evidence that Wells Fargo is too big and unruly to be properly managed.
The CEO, who had been hailed for expertly navigating Wells Fargo through the financial crisis and keeping Wells out of toxic mortgages, is facing a crisis at the bank that may exceed what it faced then. Wells Fargo is also under investigation by the House Financial Services Committee and is being sued for fraud and negligence by customers.
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Stumpf offered some detail at the hearing about who was sacked, saying “bankers, bank managers, managers of managers, and even an area president”.
