He said the consultant found that 115,000 of the unauthorized accounts had been charged fees. Not only did the bank get slapped with $185 million in fines last week, but Wells Fargo admitted to firing 5,300 employees over the past few years for improper sales tactics and now faces a grilling next week from Senator Elizabeth Warren and other members of the Senate Banking committee. The recent revelation was a key driver to convince Armstrong to submit a proposal again, this time for the 2017 annual meeting expected in April.
Advertisement
“She made a personal decision to retire after 27 years with the company”, the spokesman said. For example, in 2016, an Armstrong proposal to install an independent chairman received roughly 17% of the voting shares.
On Friday, Wells Fargo sent an alert to some of its employees requesting that they temporarily suspend the practice of trying to sell customers other products – known as cross-selling – because of high call volumes.
Wells Fargo was recently down about 3%, more than the 2.4% fall in the KBW Nasdaq Bank Index, while J.P. Morgan fell 1.7%. She has earned a base salary of $1.7 million for at least the last four years, according to Securities and Exchange Commission filings.
Wells Fargo, the largest bank in SC, has always been known for its aggressive sales goals, But in an industry plagued with questionable action during the mortgage bubble and financial crisis, it was also regarded as a well-run, tightly managed firm that did not get into the poisonous behavior of its Wall Street counterparts.
Wells Fargo, which is grappling with the fallout from claims that its employees created fake customer accounts, slumped 3.3 per cent to close at $US46.96 Tuesday in NY.
“This morning we took the further step of announcing the elimination of sales goals in retail banking”, effective January 1, he said.
The investigation was first reported by the Wall Street Journal. It will also pay restitution to affected customers.
“We are prepared to provide the committee with information on this matter and to discuss steps we have taken to affirm our commitment to customers”, the Wells Fargo spokesperson said.
While Wells Fargo was America’s most valuable commercial bank for years, it still trailed JPMorgan in terms of who controlled more assets. “When we fall short of that goal, I feel accountable and our leadership team feels accountable-and we want all our stakeholders to know that”.
It marked a significant shift by Wells Fargo, which prides itself on “cross selling” customers as many “products” – like checking accounts and debit cards – as possible.
Advertisement
He added that Wells Fargo’s headaches are also “quickly becoming a political problem” for big banks in general, providing critics “more ammunition to argue that mega banks are unmanageable”.
