Home >> Daily Dose >> OCC: Ex-Wells Fargo CEO Banned For Life From Banking
Print This Post Print This Post

OCC: Ex-Wells Fargo CEO Banned For Life From Banking

Federal officials announced Thursday that John Stumpf, the former head of Wells Fargo, has been barred from ever working for a bank due to his connection with its cross-selling scandal. 

“The actions announced by the [Office of the Comptroller of Currency] today reinforce the agency’s expectations that management and employees of national banks and federal savings associations provide fair access to financial services, treat customers fairly, and comply with applicable laws and regulations,” stated Comptroller of the Currency Joseph Otting in a release.

Along with Stumpf, eight former executives were fined for their role in sales fraud. Included was the former Head of the Community Bank Carrie Tolstedt, who could face penalties of nearly $25 million. Stumpf has agreed to a $17.5 million penalty.

Charlie Scharf, Wells Fargo’s new CEO and President, called the action by former employees “inexcusable.” 

“The OCC’s actions are consistent with my belief that we should hold ourselves and individuals accountable. They also are consistent with our belief that significant parts of the operating model of our Community Bank were flawed,” Scharf said. “At the time of the sales practices issues, the Company did not have in place the appropriate people, structure, processes, controls, or culture to prevent the inappropriate conduct … Our customers and you all deserved more from the leadership of this Company.”

Scharf added that Wells Fargo has made “fundamental changes” to its business model, compensation programs, leadership, and governance. 

“We are committing all necessary resources to ensure that we operate with the strongest business practices and controls, maintain the highest level of integrity, and have in place the appropriate culture. The Company is different today, but we know we still have significant work to do to regain the trust of all stakeholders,” he said.

The bank was fined $100 million in 2016 over the practice over employees opening fake accounts to receive sales bonuses. 

A CFPB release from September 2016 states Wells Fargo employees “secretly opened” unauthorized accounts to hit sales goals. 

“Because of the severity of these violations, Wells Fargo is paying the largest penalty the CFPB has ever imposed,” former CFPB Director Richard Cordray said in the release. 

About Author: Mike Albanese

A graduate of the University of Alabama, Mike Albanese has worked for news publications since 2011 in Texas and Colorado. He has built a portfolio of more than 1,000 articles, covering city government, police and crime, business, sports, and is experienced in crafting engaging features and enterprise pieces. He spent time as the sports editor for the "Pilot Point Post-Signal," and has covered the DFW Metroplex for several years. He has also assisted with sports coverage and editing duties with the "Dallas Morning News" and "Denton Record-Chronicle" over the past several years.
x

Check Also

Trump: Revisiting Regulatory Barriers to Home Affordability a ‘Priority’

A White House report says current restrictions are causing numerous problems from increasing homelessness mobility to dampening the overall economy, and the administration plans to take action.

GET THE NEWS YOU NEED, WHEN YOU NEED IT.

With daily content from MReport, you’ll never miss another important headline in originations, lending, or servicing. Subscribe to MDaily to begin receiving a complimentary daily email containing the top mortgage news and market information.