Senators grill Wells Fargo CEO over scandal, forced arbitration

  • Senators grill Wells Fargo CEO over scandal, forced arbitration

Senators grill Wells Fargo CEO over scandal, forced arbitration

We will look into it!

The Office of the Comptroller of the Currency, the leading regulator for Wells Fargo, is considering new sanctions against the bank for customer abuses involving auto insurance and mortgage loans, Reuters reported on Monday. Tim Scott, a Republican from SC.

But Senator Sherrod Brown lambasted Wells Fargo for forcing consumers in many cases into arbitration, a behind- closed-door process that can keep corporate malfeasance from courtroom exposure and that critics say often leaves consumers paying. "What in god's name were you thinking?" Wells Fargo fired 5,300 mostly low-level workers over the practice. When then-CEO John Stumpf faced Congress last fall, he was chastised for his answers and for what lawmakers saw as an attempt to shift blame.

Wells Fargo ended up paying $185 million to regulators and settled a class-action suit for $142 million. Mr. Sloan did say he'd try to minimize the number of customer disputes that go to arbitration.

Since last fall, Wells has changed its sales practices, ousted other executives and called tens of millions of customers to check on whether they truly opened the accounts.

"I apologize for the damage done to all the people who work and bank at this important American institution", he said.

The scandal has only grown since Stumpf's appearance. The bank raised that estimate in August to potentially as many as 3.5 million.Sloan said on Tuesday he was "confident" no more than 3.5 million unauthorized accounts were opened.Warren, who a year ago accused Stumpf of "gutless leadership", has repeatedly called on the Federal Reserve to remove 12 members of Wells Fargo's board of directors, including Vice Chair Elizabeth Duke.Duke, a former Fed governor, is set to take over from Wells Fargo Chairman Stephen Sanger at the start of 2018. A report by the board of directors found the bad behavior could be traced back to as early as 2002, and that executives were aware of some sales practices problems as early as 2006. "At best you were incompetent, at worst you were complicit", Warren (D-Mass.) told Sloan, the former chief financial officer who replaced former chief executive John Stumpf late past year. In late July, it said hundreds of thousands of customers were due a refund on auto insurance that they did not need.In late August, a homeowner sued Wells Fargo for charging too much for his fixed-rate mortgage. But the remarks won't satisfy Warren and many other Democrats who will use the hearing to demand the ousting of executives or board members in place when fake accounts were being opened, Seiberg wrote.

The hearing occurred about a year after Wells Fargo leaders appeared in Washington to speak about the fake accounts, which were used to boost sales figures.

In an increasingly contentious exchange, Warren chronicled Sloan's past statements about the sales practices at Wells Fargo and accused him of either encouraging or being complicit in the company's high-pressure culture. "Either way, you should be fired".