Wells Fargo: Independent directors have launched probe into sales practices
On September 8, 2016, Wells Fargo & Company reached agreements with the Consumer Financial Protection Bureau, the Office of the Comptroller of the Currency, and the Office of the Los Angeles City Attorney, regarding allegations that some of its retail customers received products and services they did not request. The amount of the settlements, which the Company had fully accrued for as of June 30, 2016, totaled $185 million, plus $5 million in customer remediation. Key actions are being taken to ensure the Company's culture is wholly aligned with the interests of customers including: Eliminated product sales goals for retail banking team members as of October 1, 2016; Implemented procedures to send customers a confirmation email approximately an hour after opening any deposit account and an acknowledgement letter after submitting a credit card application; Attempting to contact all retail and small business deposit customers across the country, including those who have already received refunded fees, to invite them to review their accounts with their banker. Also contacting credit card customers identified as possibly having unauthorized accounts to confirm whether they need or want their credit card; Expanding the scope of our customer account review and remediation to include 2009 and 2010; The Independent Directors of the Board have launched an investigation into the Company's retail banking sales practices and related matters. Independent Directors have retained the Shearman & Sterling law firm to assist in the investigation; John Stumpf forfeited unvested equity awards valued at approximately $41 million; Carrie Tolstedt has left the Company; will receive no severance; has forfeited unvested equity awards valued at approximately $19 million; will not exercise outstanding options during investigation; Neither executive will receive a bonus for 2016.