Wells Fargo cutting sales goals in wake of $185 million fine

“This is a major victory for consumers”, said Los Angeles City Attorney Mike Feuer, touting the $50 million the city extracted from the bank. The bank went a step further on Tuesday, dropping the sales goals that employees said led to pressure to open fake accounts. Wells Fargo declined to comment on the possibility of a clawback. Some observers see it as a case of the company blaming the 5,300 workers for its misdeeds, taking little or no responsibility for what occurred.

At the center of the bad behavior appears to be an effort by the bank to persuade customers to sign up for multiple products, known as “cross selling”.

Some Wells Fargo customers have complained of similar allegedly fraudulent practices.

The consumer bureau and the Office of the Comptroller of the Currency also opened investigations and found that bank employees illegally transferred money from legitimate accounts into unauthorized ones opened for customers without their approval.

Last year, as executive vice president of the division, Tolstedt made $9 million in total pay, a reward for “continued growth in primary checking customers” and other metrics.

“You cannot think about the size, the magnitude of what took place here – a million and a half bank accounts, 565,000 credit cards over the course of five years – and wonder how it is that what seems to be a large, coordinated scheme could take place without some knowledge by the higher-ups”, Sen.

Wells Fargo announced plans Tuesday to cut its aggressive product sales goals for retail bankers, almost a week after state and federal regulators fined the bank $185 million for allegedly opening millions of unauthorized accounts for its customers to meet those targets.

Given that 5,300 employees, not just a handful of bad actors, were fired for what boils down to identity theft for profit, Wells Fargo would be better served serving its goal, rather than investing time and energy bartering in social and political activism.

On Tuesday, the CFPB said Cordray had not been invited to testify.

On Sept. 13, Wells Fargo stock dropped almost 3.2 percent.

Looking closer at the Wells Fargo fraud scandal, it has been uncovered that the executive who directed the over-5,000 employees fired this week escaped the company unscathed, with no repercussions for her role, and a massive $124 million in exit pay.

When asked by ABC News why the goals program was not ending immediately, Wells Fargo spokesperson Richele Messick replied, “We understand the details matter, and it’s important we get them right”. But as one of the nation’s biggest financial institutions, Wells Fargo executives also highlight every quarter the so-called cross-sale ratio, a metric only Wells Fargo used that reflects the number of products the bank sells to each customer.