House lawmakers heap blistering criticism on Wells Fargo CEO
WASHINGTON (AP) – Angry lawmakers heaped another round of blistering criticism on Wells Fargo’s CEO, pressing Thursday for details about what senior managers knew about allegedly illegal sales practices and when any concerns were disclosed.
Chief Executive John Stumpf, newly stripped of tens of millions in compensation, told the House Financial Services Committee that the bank is expanding its review of accounts and will evaluate executives’ roles. But as during the grilling he received last week from a Senate panel, Stumpf remained on the defensive.
Several lawmakers, both Republican and Democrat, alleged Wells Fargo’s sales practices may have violated federal laws, including the federal racketeering laws, which would constitute a criminal offense. Federal regulators have not said if they have referred the Wells Fargo case to the Depart- ment of Justice.
“Fraud is fraud. Theft is theft,” committee head Rep. Jeb Hensarling, R-Texas, told Stumpf.
The panel’s senior Democrat, Rep. Maxine Waters of California, was adamant the alleged abuses show that the second-largest U.S. bank is too big for senior executives to keep track of what’s going on. “I have come to the conclusion that Wells Fargo should be broken up,” she said.
Stumpf reiterated his previous words, that he was “deeply sorry.” He said the bank was looking at accounts further back, to 2009, and that an inquiry by Wells Fargo’s outside directors will review executives’ roles “across the board.”
U.S. and California regulators have fined San Francisco-based Wells Fargo $185 million, saying bank employees trying to meet sales targets opened up to 2 million fake deposit and credit card accounts without customers’ knowledge.
Regulators said they issued and activated debit cards, and signed people up for online banking without permission. The abuses are said to have gone on for years, unchecked by senior management.
Stumpf finally shared some basic information about the potential victims, saying those affected skewed to younger Wells customers. When questioned by lawmakers, Stumpf also gave some state-by-state breakdowns.