Describing Wells Fargo’s opening or attempted opening of the accounts as “fraud”, the senators wrote in a letter to Labor Secretary Tom Perez and DOL Administrator David Weil that “the suggestion last week by Chief Executive John Stumpf that ‘[t] here was no incentive to do bad things’ at Wells Fargo – a company that fired 5,300 employees over five years due to improper selling but made little effort to change its policies – does not appear to be grounded in reality”.
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Wells Fargo CEO John Stumpf stepped down from his position on the Federal Reserve Advisory Council Thursday, according to a statement from the San Francisco Federal Reserve.
“For years Wells Fargo employees have described a management culture characterized by “mental abuse, ‘ being forced to work overtime “for what felt like after-school detention” during the week and on weekends, and being ‘severely chastised and embarrassed in front of 60-plus managers.'”The letter was signed by Massachusetts Senator Elizabeth Warren, Senate Banking Ranking Minority Member Sherrod Brown, Rhode Island Senator Jack Reed, New Jersey Senator Robert Menendez, Vermont Senator Bernie Sanders, Oregon Senator Jeff Merkley, New York Senator Kirsten Gillibrand, and Hawaii Senator Mazie Hirono“. He faced intense questioning Tuesday before the Senate Banking Committee. Earlier this month, regulators fined Wells Fargo $185 million for the scheme, which also included cases of workers moving customers’ money without permission to fund the sham accounts. (Members to the Federal Advisory Council are appointed for one-year terms each January.) It was unclear whether the letter played a role in his resignation. Read our story from the time, or see how the scandal affects customers. His top priority is leading Wells Fargo.
Stumpf is working to regain customers’ trust and rebuild the bank’s reputation after it became widely known that employees opened more than 2 million credit card and deposit accounts without customers’ approval.
Senators of both parties accused the bank of fraud and told Stumpf he was scapegoating legions of lower-level employees while senior executives kept their jobs and received hefty pay packages. She is expected to leave with as much as $125 million in salary, stock options and other compensation.
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While it varied by branch size and day of the week, a typical employee had to sell between 13 and 15 banking products a day – a new account, a mortgage, a retirement account, or even online banking.
