Here’s What Wells Fargo Is Doing to Fix Its Fake Account Scandal

September 13, 2016, 12:20 PM UTC
JPMorgan Chase & Co. And Wells Fargo & Co. Bank Branches Ahead Of Earnings
Photograph by Bloomberg via Getty Images

Wells Fargo (WFC), the largest U.S. bank by market capitalization, said on Tuesday it would eliminate all product sales goals in retail banking, starting next year.

The move comes days after the Consumer Financial Protection Bureau (CFPB) and two other regulators fined the bank $185 million over abusive sales practices.

The bank paid another $5 million to customers for creating more than 2 million fake accounts for products like credit and debit cards to meet aggressive sales targets.

Customers should know that Wells Fargo retail bankers are always focused on their best interests, CEO John Stumpf said in a statement on Tuesday.

The enforcement action caught the attention of U.S. presidential candidate Hillary Clinton, who on Friday applauded the CFPB, censuring Wells Fargo for what she called “outrageous behavior.”


On Monday, five lawmakers wrote a letter to U.S. Senate Banking Committee Chairman Richard Shelby calling for an investigation.

Credit rating agency Moody’s Investors Service also commented, saying the “embarrassing episode” would have a negative impact on Wells Fargo’s outstanding debt.

Wells Fargo said it had fired 5,300 employees involved in the sales practices described by the settlement. Carrie Tolstedt, the executive who was in charge of the unit where employees opened the fake accounts, is leaving the company with an enormous payday of $124.6 million.

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