As Wells Fargo Faces Senate Panel, Elizabeth Warren Calls for Criminal Charges

Stumpf was being taken to task by the committee over news earlier this month that employees of the bank had opened 2 million unauthorized bank accounts using customers’ names from 2011 onward.

“This is about accountability”, Warren said, adding that he should pay back money and resign – and, she added, “you should be criminally investigated by both the Department of Justice and the Securities and Exchange Commission”.

Wells Fargo has always been known for its aggressive sales goals, but the details and the $185 million fine that regulators imposed last week have singed the consumer banking giant’s reputation as a well-run, tightly managed company removed from the reckless conduct on Wall Street that stoked the financial crisis.

Multiple senators wanted to know whether Stumpf believed Wells Fargo should rescind, or “claw back”, some of the compensation owed to Stumpf and Carrie Tolstedt, the longtime executive who ran the bank’s consumer banking unit that oversaw numerous sales practices.

Tolstedt announced her retirement in July after amassing salary, bonuses, stock, options and other compensation totaling $124.6 million in her career, Fortune reported, although others placed the figure in the mid-$90-million range.

“You’re not wiling to say publicly … that some of her compensation … should be clawed back?” asked Sen. He bristled at assertions that the alleged opening of millions of customer accounts without their permission was a “scam”.

About 5,300 employees were fired in connection with the scandal, which was first uncovered by the Los Angeles Times in 2013.

“There is no better example than the recently-exposed illegal behavior at Wells Fargo”.

Today’s committee hearing will certainly not be the last time Stumpf or Wells Fargo will face a tough series of questions in front of regulators and the American public.

Richard Cordray, director of the Consumer Financial Protection Bureau, said the agency expects to reach 1 million complaints by the end of the week.

Under the settlement, Wells Fargo neither admitted nor denied the allegations. The average Wells Fargo household had on average more than six products with the bank, a metric Wells top executives would highlight every quarter with investors.

Sen. Elizabeth Warren flatly told Stumpf he should step down.

The bank CEO stopped short of placing blame on any senior executives, however, claiming that there was “no orchestrated effort” to get employees to create phony accounts.

“Mr. Stumpf, you make it clear that Wall Street will not change until we make it change”, said Warren. “So 5,300 team members, earning perhaps $30,000 a year, have lost their jobs, while Ms. Tolstedt walks away with $100 million, give or take”.

The CEO of embattled Wells Fargo has appeared to testify before the Senate Banking Committee on the scandal over allegations that employees opened millions of unauthorized accounts to meet aggressive sales targets.

Chief Executive John Stumpf showed contrition in testimony to the Senate Banking Committee, saying he is “deeply sorry” that the bank failed to meet its responsibility to customers and didn’t act sooner to stem what he called “this unacceptable activity”.

“If there were ever a textbook case where consumers needed protecting, this was it”, Shelby said. The banking chief was called to a Congressional committee hearing to answer questions about the company’s fraud, and several key USA senators held nothing back while grilling Stumpf.