Senators lay into Wells Fargo chief over accounts ‘scam'
Members of the Senate Banking Committee showed bipartisan outrage over the long-running conduct, unsatisfied by CEO John Stumpf's show of contrition.
Stumpf said he was “deeply sorry” that the bank failed to meet its responsibility to customers and didn't act sooner to stem “this unacceptable activity.” He promised to assist affected customers.
Sen. Elizabeth Warren flatly told Stumpf he should resign. “You squeezed your employees to the breaking point so they would cheat customers,” she said. “You should resign. You should give back the money you took while the scam was going on.”
The Massachusetts Democrat, one of the fiercest critics of Wall Street, also advocated for a criminal investigation by the Justice Department and securities regulators.
Stumpf, a 34-year veteran of Wells Fargo and CEO since 2007, earned $19.3 million last year. The bank does have in place provisions its board could implement to claim back executive compensation.
Wells Fargo sales employees, trying to meet targets that called for every customer to have eight products with the bank, opened more than 2 million bank and credit card accounts, regulators said last week in levying a $185 million fine.
Money in customers' accounts was said to have been moved to these new accounts without their permission. Debit cards were issued and Personal Identification Numbers created without customers' knowledge.
Peppered with criticism for hours, Stumpf at one point bristled at Warren's suggestion that the practices were a “scam.”
The senators challenged assertions that he and other senior executives didn't become aware of the problems until 2013 — when the sales misconduct was reported by The Los Angeles Times.
Some 5,300 Wells Fargo employees have been fired. They ranged in pay from about $35,000 to $65,000.
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