Monthly Archives: September 2016

Wells Fargo faces hostility over unethical conduct charges

Wells Fargo CEO John G. Stumpf under the spotlight as bank castigated for unethical conductIllegal banking practices come home to roost

A year ago, the city of Los Angeles sued Wells Fargo for unethical customer conduct, alleging that the bank had covertly opened unauthorised accounts on behalf of customers. Twelve months on and the bank has been forced to reach settlements with city and federal officials totalling almost $200 million.

At a September hearing before the House Financial Services Committee, Wells Fargo CEO John G. Stumpf announced he was forfeiting at least $41 million in pay, at the same time vowing to immediately drop the banks sales incentive programme that was to blame for inciting bankers to set up the illegal accounts.

But it seems that few of his interrogators were impressed, with lawmakers from both sides of the house taking turns to tear into Stumpf over a period of four hours, labelling the bank’s actions as ‘theft’ and commenting that the fallout from the scandal had dealt a devastating blow to the entire banking industry.

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