U.S. Senate Banking Committee Grills Wells Fargo CEO on Damaging Sales Practices

U.S. Senators from both political parties strongly criticized Wells Fargo's damaging sales practices and grilled the bank's CEO John Stumpf in a Capitol Hill hearing on Tuesday. The hearing was called after Wells Fargo was fined $185 million by the Consumer Financial Protection Bureau (CFPB) and other agencies for opening fraudulent, unwanted bank accounts for customers. Wells Fargo fired and blamed 5,500 bank workers earning $11-15 an hour, while the top executive in charge of sales left with a payment of $120 million.

The Committee for Better Banks, a coalition formed by CWA, bank workers, and other community and consumer advocates, held a call before the hearing to show that the Wells Fargo scandal is only the tip of the iceberg, and that big banks' unreasonable sales quotas are harming both consumers and frontline bank workers.

Julie Miller, a former Wells Fargo branch manager in Allentown, Pa., said on the call, "When Wells Fargo CEO John Stumpf blames the frontline workers for the unauthorized accounts, I am disgusted. I saw firsthand how the sales goals structure and the pressure to 'sell at all costs' came from upper level, corporate executives. Corporate executives designed the sales quota systems and created the culture of harassment and fear when we did not meet them."

Khalid Taha, a former Wells Fargo personal banker in San Diego, Ca., said, "The branch where I worked was structured in such a way that we had to meet sales quotas every day. If I did not meet my sales goals, I could get written up and risked being fired. This kind of pressure meant we had to prioritize selling products, rather than just focusing on what best matched our customers' needs."

At the hearing, Senator Elizabeth Warren (D-Ma.) lambasted Stumpf for blaming low-paid bank workers. "You kept your job, you kept your multi-million dollar bonuses, and you went on television to blame thousands of $12-an-hour employees who were just trying to meet cross-sell quotas that made you rich. You should resign, you should give back the money that you took while this scam was going on, and you should be criminally investigated."

Senator Sherrod Brown (D-Ohio) said, "Wells Fargo is taking out full-page ads claiming it is accountable and accepts responsibility. But it has not admitted to responsibility for a single misdeed, and it has been hostile to customers who are facing this issue."

Senator Jeff Merkley (D-Ore.) told Stumpf that 5,300 bank workers had been fired "because of the culture you established. This was a systemic problem that you benefited from enormously, that the bank benefited from enormously, and you are scapegoating the people at the very bottom. Accepting full responsibility for establishing a culture that put people in an impossible situation would be to resign, return your funds, and help fund assistance for fired employees."

Read more about the Committee for Better Banks and get involved here.

Khalid Taha, a former Wells Fargo bank worker, tells his story to the New York Times.