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It’s been one year since the Wells Fargo fake-accounts scandal came to light, and Sen. Elizabeth Warren of Massachusetts doesn’t think the bank has done enough to make up for the damage.
As a refresher, it was initially found that Wells Fargo employees opened more than 2 million accounts in customers’ names without their knowledge from 2011 to 2015. The scope of the scandal has since increased with the possibility of more fraudulent accounts opened over a longer period of time.
Warren said Tuesday during a hearing, which CEO Tim Sloan attended, that even though Sloan’s predecessor, John Stumpf, had stepped down as CEO she thought the bank had not done enough to mitigate the practices regarding fake accounts and failed to make things right in the year since the scandal surfaced.
“Wells Fargo cheated millions of people for years,” Warren said. “The Federal Reserve should remove all of the current board members who’ve served during the fake-accounts scandal scam. And, Mr. Sloan, you say you’ve been making changes at Wells Fargo for 30 years, but you enabled this fake-accounts scam, you got rich off it, and you tried to cover it up. At best you were incompetent – at worst you were complicit. Either way, you should be fired.”
Sloan retorted that the board of directors made significant changes and held executives and employees of the bank accountable for the scandal.
This isn’t the first time Warren, a strident critic of Wall Street, has gone after a Wells Fargo CEO. During Stumpf’s testimony last September, Warren lit into the bank and its executives.
Warren dinged Sloan for being at the bank for nearly three decades, saying his insider status was detrimental to creating real change at the bank. The senator pointed to quarterly earnings calls, which she said showed that Sloan – who was then the company’s CFO – aggressively promoted Wells Fargo’s ability to open new accounts for customers.
“I’ve read through them, and on these calls no one – not even John Stumpf, who was CEO at the time – bragged more about Wells Fargo’s ability and commitment to opening new accounts for existing customers,” Warren said, going on to quote Sloan from one of the calls.
Warren also pointed to other statements in which Sloan defended the sales practices and culture of Wells Fargo as proof that the CEO was not credible as an agent of change for the bank.
Sloan pushed back on those suggestions.
“Our job is to satisfy our customers’ financial needs and to help them succeed financially,” Sloan said, adding: “Since I’ve become CEO, I’ve made fundamental changes to address the issues we’re talking about today.”