Wells Fargo CEO Testifies on Company Reforms Before Skeptical Congress

Mae Love
March 15, 2019

"Our constituents should be able to trust their own bank".

Still, Sloan remained calm under questioning, though he appeared to frustrate some lawmakers by declining to disclose confidential information on the progress of some remediation efforts, and by failing to say categorically that Wells Fargo would never suffer another scandal.

Waters, a Democrat who became head of the committee in January, has been a frequent Wells Fargo critic and represents San Francisco-based Wells Fargo's home state.

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"So you're smart, they're dumb, you have their best interests at heart", Sherman said. "Why should Wells Fargo continue to be the size that it is?" Sloan promised that he has made "fundamental changes" at the bank and its problems have been "fixed".

"You will hear bipartisan criticism of the actions you have taken and the failures that you have overseen under your watch", he said.

Wells Fargo's scandals have been wide-ranging and costly.

The act, created by Congress in 1977, requires banks to make loans in the communities where they do business, including low- and moderate-income neighborhoods.

While Sloan assured lawmakers that Wells is doing everything it can to comply with regulators, one federal banking agency took issue with the assertion.

Meeks asked Sloan if he thought the downgrade was appropriate.

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As Sloan spoke, screens mounted on the committee walls projected excerpts from an article published Saturday in The New York Times; it revealed that debt collectors working for Wells Fargo in Des Moines, Iowa, were tasked with making 33 calls an hour and recouping some $40,000 in unpaid debts over the course of a month.

Lawmakers could also ask about the bank's decision to cut thousands of U.S.jobs, its pledge to boost stock buybacks and its forced arbitration policy for customers.

Still, Beck doubted the House hearing would lead to more drastic penalties on Wells Fargo, like breaking up the bank.

Wells Fargo has admitted to several misdeeds over the past two years: opening millions of accounts that customers didn't want or ask for; improperly repossessing thousands of cars, including from some members of the military; mistakenly foreclosing on hundreds of homeowners; and miscalculating the fees it charges customers.

A Wells Fargo spokesperson told Yahoo Finance Sloan doesn't feel additional pressure being the first CEO in the witness chair.

Stumpf retired almost two weeks after his grilling before that committee, which was chaired by Texas Republican Jeb Hensarling.

Ocasio-Cortez's inquiries come as activists more and more search to "deplatform" political opponents by chopping off their funding from banks and different monetary providers suppliers - a concerted effort that conservatives and libertarians have stated threatens free speech.

"Sloan could intensify the legislative scrutiny if he is seen as evasive or insincere", he wrote.

She went on to address Wells Fargo's financing of the Dakota Access Pipeline, asking whether the bank should be required to cover environmental clean-up costs if something went wrong.

Stephen Beck, founder of the CG42 management consulting firm that advises banks among other industries, said a study conducted by his company belies that claim. Wells Fargo recently agreed to reimburse the customers for $575 million. The bank has launched multiple marketing campaigns hoping to fix its reputation as the scandals continue to pile up, repeatedly reassuring investors of its great progress during quarterly earnings calls.

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