The scandal-plagued bank’s CEO, Tim Sloan, appeared before the Senate Banking Committee Tuesday, and although he said he was “deeply sorry” for the bank’s scandals, committee members were not gentle in their criticisms of the bank.
Committee Chairman Mike Crapo (R-Idaho) pointed out that former Wells Fargo CEO John Stumpf had testified before the committee just over a year prior, after it was revealed that the bank had opened millions of customer accounts without those customers’ knowledge or consent.
“Mr. Stumpf repeatedly committed that the bank would take necessary actions to make it right, and to restore the public’s and investors’ trust in the company,” Crapo said. “…However, new developments and disclosures at the bank during the last year merit new scrutiny.”
Crapo pointed out that since Stumpf promised that the bank would do better, it has been rocked by scandal after scandal. For instance, the number of unauthorized accounts was found to be much higher than originally stated. The bank also charged hundreds of thousands of car-loan customers for unnecessary auto insurance, and allegedly modified mortgage terms without borrowers’ knowledge or consent.
Ranking member Sherrod Brown (D-Ohio) pointed out that Wells Fargo was aware of at least some of these abuses long before they were revealed to the public.
“The bank was aware of the problems in its auto loan division in July 2016,” Brown said. “And yet Wells Fargo told this committee that fraudulent sales practices were limited to the community bank. Mind you, this was not a casual response to a question that caught somebody off guard in a hearing, but a written response that undoubtedly was approved by lawyers and others at the bank.”
Sloan apologized for the Wells Fargo’s conduct, but insisted that the bank was changing its culture and holding leaders accountable.
“The entire Wells Fargo team – all 270,000 of us – is committed to making things right for customers the bank let down,” Sloan said.
For Sen. Elizabeth Warren (D-Mass.), however, Sloan’s efforts weren’t sufficient.
“You should be fired,” Warren told Sloan. “Wells Fargo needs to start over, and that won’t happen until the bank rids itself of people like you who led it into this crisis.”
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Both Democrats and Republicans had harsh words for the head of Wells Fargo Tuesday.