Wells Fargo CEO Steps Down From Federal Reserve Advisory Council
September 22 2016 - 6:30PM
Dow Jones News
Wells Fargo & Co. Chief Executive John Stumpf has stepped
down from his role on a Federal Reserve advisory council, the San
Francisco Fed announced Thursday.
Mr. Stumpf served as the San Francisco Fed's representative to
the council of bankers, which meets four times a year to discuss
economic and banking matters with the Fed's board of governors in
Washington.
"John made a personal decision to resign as the Twelfth
District's representative to the Federal Advisory Council," Wells
Fargo spokesman Mark Folk said. "His top priority is leading Wells
Fargo."
The embattled chief executive has been under pressure following
revelations that thousands of employees created as many as two
million of unwanted or fictitious customer accounts.
Lawmakers blasted Mr. Stumpf on Tuesday at a hearing on
Capitol Hill over the scandal. In a letter to the San Francisco Fed
Thursday, several Democratic senators including Elizabeth Warren of
Massachusetts called on the bank's board of directors to reject Mr.
Stump's reappointment to the Federal Advisory Council.
"It would be ironic if the Federal Reserve, a key federal
banking regulator tasked in part with ensuring the fair and
equitable treatment of consumers in financial transactions,
continued to receive special insights and recommendations from
senior management of a financial institution that just paid a
record-breaking fine to the Consumer Financial Protection Bureau
for 'unfair' and 'abusive' practices that placed consumers at
financial risk," they wrote.
The San Francisco Fed and Office of the Comptroller of the
Currency were examining Wells Fargo over its sales culture in 2015.
At the time, the regulators wanted to know if the bank had pushed
its employees too hard to meet sales quotas and not done enough to
prevent questionable behavior.
The OCC was one of the parties, along with the Consumer
Financial Protection Bureau and Los Angeles City Attorney, to the
regulatory settlement Wells Fargo entered into earlier this month,
agreeing to pay a $185 million fine over its sales practices.
http://www.wsj.com/articles/wells-fargo-to-pay-185-million-fine-over-account-openings-1473352548
The Federal Advisory Council is made up of 12 senior bankers who
meet at least four times a year to advise the central bank's board.
Regional Federal Reserve banks choose a person to represent their
district on the council. The board currently includes Citigroup's
Chief Executive Officer Michael L. Corbat, Eastern Bank CEO Richard
E. Holbrook, and Great Western Bancorp Inc.'s CEO Ken Karels.
Write to Kate Davidson at kate.davidson@wsj.com and Shayndi
Raice at shayndi.raice@wsj.com
(END) Dow Jones Newswires
September 22, 2016 18:15 ET (22:15 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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