How Wells Fargo’s Carrie Tolstedt Went from Fortune Most Powerful Woman to Villain

Apr 10, 2017

Wells Fargo will claw back an additional $75 million from two former executives implicated in the bank's phony accounts scandal. In doing so, Wells Fargo has also apparently closed the coffin on the career of Carrie L. Tolstedt, who was prized as a superstar female leader before the bank fired her last year.

Following the revelations last summer that thousands of Wells Fargo employees fraudulently opened as many as two million unauthorized accounts for customers, the bank released a report Monday detailing the findings of its board's investigation into the problems, and the consequences it imposed as a result. In dollar terms, that inquiry proved very costly to former Wells Fargo (wfc) CEO John Stumpf, who will give up another $28 million of past compensation in addition to a previously announced $41 million clawback, as well as Tolstedt, who will relinquish $47 million more of her pay on top of the $19 million that was already revoked.

But while Tolstedt's total clawbacks, at $67 million, are slightly less than the $69 million that Stumpf lost, there is no question that she is the one painted as the true villain in the board's report.

As The Wall Street Journal first observed, Tolstedt's name is mentioned 142 times in the 113-page document. Former CEO Stumpf, who resigned in October, is referenced only 81 times. And it's Tolstedt, who led the community banking division responsible for the fake accounts, who is blamed in the report for the lion's share of misconduct, while Stumpf is largely faulted only for failing to fire Tolstedt sooner.

The language Wells Fargo's board uses to describe each leader makes this clear. Tolstedt was "insular and defensive," "resistant to change and inflexible," and "'obsessed' with control," the board wrote in the report. She "mismanaged" the bank's response to the aggressive sales tactics that seemed to breed bad behavior, submitting reports to the board that were "viewed by many as misleading." What's more, the board accused Tolstedt of being callous and indifferent to the potential harm she was causing: "There is no evidence that Tolstedt showed serious concern about the effects of improper sales practices on Wells Fargo’s customers," it wrote.

Meanwhile, the board could find nothing worse to say about Stumpf than that he "was by nature an optimistic executive" who "nonetheless moved too slowly to address the management issue."

Tolstedt, on the advice of counsel, declined to participate in or be interviewed for the Wells Fargo internal report. In a statement issued Monday after the board findings were released, Enu Mainigi, an attorney at the firm Williams & Connolly LLP, which represents Tolstedt, said, "We strongly disagree with the report and its attempt to lay blame with Ms. Tolstedt. A full and fair examination of the facts will produce a different conclusion."

An unhappy ending

Wells Fargo's findings are an ignominious career finale for Tolstedt, who was a fixture on Fortune's annual Most Powerful Women list, ranked at No. 27 as recently as 2015, recognized as the most powerful female banker in the U.S. at the time. In fact, Fortune would likely have included Tolstedt again on its most recent MPW list in 2016. In July, however, Tolstedt abruptly announced she would retire at the end of that year, disqualifying her from the list.

Ultimately, despite her plans to retire voluntarily, Wells Fargo decided in September that it would fire Tolstedt for cause, employing a harsh distinction rarely used in an industry that often lets even shamed executives walk away on their own terms. Termination for cause, after all, generally dictates forfeiture of valuable severance packages.

That outcome seems to have disproportionately fallen on women as a result of Wells Fargo's fake account scandal: Besides Tolstedt, Wells Fargo also terminated four other executives for cause in February, three of whom were women, the board said in its report. (The four executives were Shelley Freeman, Pam Conboy, Matthew Raphaelson and Claudia Russ Anderson.)

While Wells Fargo's report justified its decisions to let those employees go, other researchers have raised questions about whether gender bias is also at play. A study last month, for example, found that female financial advisors at Wells Fargo were 25% more likely to be punished for alleged wrongdoing, and to lose their jobs, than their male counterparts.

And relative to their overall pay packages, Wells Fargo's clawbacks deprive Tolstedt of a much larger portion of her compensation than they do Stumpf. The former CEO is losing $69 million, or 85%, out of the $81 million he made between 2013 and 2016. Tolstedt, meanwhile, is giving up $67 million—or almost twice the $36 million she took home over the same period. (Tolstedt's latest round of clawbacks involved stock options that were not counted in her annual compensation from previous years because she never exercised them; rather than having to pay back Wells Fargo out of her own pocket, she will simply not receive that compensation.)

Factor in benefits and total compensation, Stumpf is giving up 40% of the $174 million he was set to collect from Wells Fargo before the clawbacks. Tolstedt, on the other hand, is losing 54% of the $125 million pay package she was originally entitled to when she retired.

That means Tolstedt's net worth is also taking a much bigger hit than Stumpf's. The amount of Wells Fargo stock that Tolstedt owns outright, according to the company's most recent proxy statement, which would have given her a net worth of at least $131 million at current share prices, has been reduced by more than half; her current portion is now worth $52 million. Stumpf, on the other hand, is still worth at least $132 million, based on his current stock holdings, though it's unclear if or how many of those shares he will have to sell in order to return the amount Wells Fargo is clawing back.

Tolstedt, of course, is not the only executive on Fortune's Most Powerful Women list to experience a sharp fall from grace. Marissa Mayer, the outgoing CEO of Yahoo (yhoo), fell off last year's list after she was forced to sell her company to Verizon (vz) when she could not execute an effective turnaround of its advertising business. Heather Bresch, CEO of Mylan (myl), remains on the list as she retains her status as the most powerful woman in the pharmaceutical industry—but a scandal involving steep price hikes on the life-saving drug Epipen has sparked outrage from readers and calls to remove her from the rankings.

While a couple of Fortune MPW alumni have reclaimed their spots on the list after switching from one Fortune 500 company to another, Tolstedt, after being so vilified by Wells Fargo, seems destined for a legacy among the ranks of powerful women who have disappeared from corporate America for good.

All products and services featured are based solely on editorial selection. FORTUNE may receive compensation for some links to products and services on this website.

Quotes delayed at least 15 minutes. Market data provided by Interactive Data. ETF and Mutual Fund data provided by Morningstar, Inc. Dow Jones Terms & Conditions: http://www.djindexes.com/mdsidx/html/tandc/indexestandcs.html. S&P Index data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Terms & Conditions. Powered and implemented by Interactive Data Managed Solutions