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Wells Fargo CEO Grilled at House Hearing over Fake Account Scandal

HeadlineSep 30, 2016

In financial news, the CEO of Wells Fargo was grilled by lawmakers on Capitol Hill on Thursday over a scandal that saw thousands of employees use private customer information to create 2 million fake accounts in order to meet sales targets. CEO John Stumpf apologized to the House Financial Services Committee and said his bank will eliminate sales quotas for employees beginning on October 1. Earlier this week, the bank took back $41 million in stock awarded to Stumpf. That did little to appease lawmakers, including New York Democratic Representative Carolyn Maloney, who noted Stumpf sold $13 million worth of Wells Fargo stock in 2013.

Rep. Carolyn Maloney: “So my question is: Did you dump $13 million of Wells Fargo stock, which you did through your family trust, right after you found out that your bank had been fraudulently opening hundreds of thousands of scam accounts, ripping off your customers?”

John Stumpf: “I sold those shares, and I sold them with proper approvals with no view about anything that was going on with sales practices or anything else.”

Earlier this month, Stumpf appeared before the Senate Banking Committee, where Massachusetts Democrat Elizabeth Warren accused him of “gutless leadership” and said he should be criminally investigated.

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