The Former Wells Fargo CEO’s Future Is Secure Despite Tens of Millions in Penalties
Bloomberg - Anders Melin - 1/23/20
John Stumpf left Wells Fargo & Co. with his image in tatters, lost more than $70 million through forfeitures and a clawback, and now faces a government fine and a lifetime ban from the financial industry.
But that won’t upend his nest egg.
Even after subtracting the clawback and forfeitures, the bank’s former chief executive officer stepped away with stock worth more than $80 million, according to calculations by Bloomberg. He collected more than $60 million of salary and bonuses during his years at the San Francisco-based firm. And he had accumulated a pension worth $22.7 million by the time he departed.
Stumpf lost his job in 2016 amid revelations that bank employees had opened potentially millions of fake accounts to meet sales goals. The allegations were damning: For years, regulators said, he had failed to heed countless warning signs of the abuses.
The Office of the Comptroller of the Currency on Thursday announced that Stumpf had agreed to a $17.5 million fine and the lifetime ban -- an unprecedented move against a banking chief. The regulator said it was seeking to impose a record $59 million in fines on eight of Wells Fargo’s former leaders for failing to stop the abuses in its branches.
In more than 100 pages of documents, the OCC detailed the “massive illegal activity” it said took place at the bank, causing “catastrophic reputational damage.” Three of the former managers, including Stumpf, agreed to consent orders and will pay penalties. Ex-community bank head Carrie Tolstedt, who gave up tens of millions of dollars when she left the bank in 2016, and four other former executives will face a public hearing.
“These charges on their own will not bring justice for employees who were unfairly scapegoated,” said Patrick Creaven, a Wells Fargo employee who’s also a member of Committee for Better Banks, an advocacy group. He acknowledged that the OCC’s action “is a step toward accountability.” A representative for Stumpf didn’t respond to requests for comment.
WSJ: "Workers at two Wells Fargo branches are expected to hold elections to decide whether to unionize"
Calling all Wells Fargo workers! Your National General Membership Meeting is coming up on November 16th