From The Washington Post:
Wells Fargo’s move late Tuesday to strip its chief executive of $41 million in compensation after a sales scandal did little to temper criticism of the company, as the megabank faced new sanctions from authorities in California.
The decision to take back thousands of shares of unvested stock from John G. Stumpf is the first time a high-ranking banking industry executive has personally faced such a steep penalty for company misdeeds since the 2008 financial crisis.
But, critics say, Wells Fargo is leaving its long-time CEO with more than $100 million in company stock and millions in salary he earned while thousands of mostly low-level employees were setting up unauthorized accounts customers didn’t ask for in order to reach aggressive sales goals.
On Wednesday, California Treasurer John Chiang imposed sanctions on the San Francisco-based bank, saying the state would not invest in the firm’s stock or use many of its services for a year.
“Wells Fargo’s fleecing of its customers by opening fraudulent accounts for the purpose of extracting millions in illegal fees demonstrates, at best, a reckless lack of institutional control and, at worst, a culture which actively promotes wanton greed,” Chiang said in a statement.
“How can I continue to entrust the public’s money to an organization which has shown such little regard for the legions of Californians who have placed their financial well-being in its care?”
In a statement, Wells Fargo said it understood the concerns being raised and took full responsibility. “Wells Fargo has diligently and professionally worked with the state for the past 17 years to support the government and people of California,” the statement said.
The bank’s action against Stumpf failed to satisfy Sen. Elizabeth Warren (D-Mass.), who blistered the executive during his appearance before the Senate Banking Committee last week, even calling for him to resign. On Wednesday, she suggested he still had not been punished enough.
Stumpf “will be just fine: he keeps …