Wells Fargo's board said Monday that it would claw back an additional $75 million in compensation from the two executives on whom it pinned most of the blame for the company's sales scandal: the bank's former chief executive, John G. Stumpf, and its former head of community banking, Carrie L. Tolstedt. The 113-page report, prepared by the law firm Shearman & Sterling, relates how Stumpf nurtured and protected Tolstedt even as evidence mounted that her division's behavior posed an enormous risk to the company.
The board's report, which detailed the results of an internal investigation that began in September, focused on sales practices and incentives at Wells Fargo's community bank unit that led to the creation of fake customer accounts, along with monitoring problems that the bank's "decentralized corporate structure" caused.
"The community bank identified itself as a sales organization, like department and retail stores, rather than a service-oriented financial institution", according to the report.
Wells Fargo CEO John Stumpf testifies on Capitol Hill in Washington, Sept. 29, 2016, before the House Financial Services Committee.
It's another example of how Wells Fargo executives repeatedly proved unable - or unwilling - to take the hard actions required to fix major flaws the bank's cultural and incentive problems that fueled the scandal.
Piper Jaffray on Tuesday upgraded Wells Fargo & Company's analyst rating to "Neutral" with its price target of 55 highlighting a potential increase of 2.63% from Wells Fargo & Company's current price of 53.59.
"For GCs, this report is just another reminder that your job involves trying to change a real culture of human beings", said Sarwal.
Sanger said that the board's report on Monday concluded almost all of its investigation and that no further terminations or compensation clawbacks are expected.
Sanger, a board member since 2003, is under pressure to assure investors and regulators that he is rooting out the bank's problems after a welter of criticism that the board did not do enough despite knowing about the problem since 2014.
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But executives treated these staffers as rogues, blamed them and treated the problem as not being systemic throughout the bank. All this in order to meet sales goals at individual branches and improve the bank's stock price. In some cases, Wells Fargo customers faced various fees for accounts they did not request, or bank employees took money from an authorized account to create a fake one.
"Stumpf was by nature an optimistic executive who refused to believe that the sales model was seriously impaired", the report states.
There's now more information about how Wells Fargo's years of shady sales tactics affected Minnesota: In a document submitted to congressional finance committee members, Wells Fargo estimated that a combined 31,000 savings, credit, and deposit accounts in Minnesota were potentially created without authorization or tampered with.
A total of US$185 million (AU$246 million) was paid in fines by the bank to federal and local authorities.
Mainigi added that they disagree the attempt of the report to lay blame with Tolstedt.
"While we have already made significant progress in making things right with customers and addressing issues, including several issues identified in the investigation, the Board's comprehensive findings provide another important opportunity to learn from our mistakes". The board decided on April 7 to require her forfeiture of $47 million in outstanding stock options.
Stumpf was pressured into retiring in October after two embarrassing appearances on Capitol Hill that saw him lambasted by a bipartisan group of Congress members.
"Growing indications that the situation was worsening and threatened substantial reputational harm to Wells Fargo" weren't enough to prompt Stumpf to investigate and critically analyze the problem, the report stated.
In the conference call with reporters, Sanger said the board "took the appropriate action with the information it had when it had it".