Democrats in the Senate want to bring Wells Fargo executives back for another high profile hearing on the bank’s recent scandals.
In a letter sent today to Senate Banking Committee Chairman Mike Crapo, Democrats on the committee called for the Idaho Republican to invite Wells Fargo CEO Timothy Sloan and Elizabeth Duke, chair of the bank’s board, to testify about news reports and investigations into more of the bank’s practices following its recent fake account scandal.
A committee spokesperson for Crapo declined to comment.
“In the wake of rampant consumer abuses and other compliance breakdowns that necessitated an unprecedented recent enforcement action by the Board of Governors of the Federal Reserve System ... members of the committee must be vigilant in holding Mr. Sloan, Ms. Duke, and Wells Fargo accountable,” the letter read.
The Fed enforcement action referenced by Democrats took the unusual step of limiting the bank's ability to grow until its management can demonstrate controls put in place to prevent a return to the practices that landed Wells in hot water.
Democrats, including committee Ranking Member Sherrod Brown D-Ohio and high-profile bank critic Sen. Elizabeth Warren D-Mass., cited recent remarks by Sloan about coverage of Wells Fargo being “tiresome,” and his widely watched appearance before the committee last year.
“Though Mr. Sloan recently said it is ‘tiresome’ for the bank to ‘live through some of the sensational headlines that, in many cases, just aren’t true,’ we believe that it is essential for the Committee to conduct oversight on the bank given the seriousness of past enforcement actions, a history of inadequate response on behalf of Wells Fargo’s senior leadership, and continued reports of misconduct,” they wrote.
One of the allegations of misconduct Senate Democrats cite is a recent settlement the bank made related to its practices in the lead up to the global financial crisis 10 years ago.
In August the bank agreed to pay over $2 billion to the Justice Department in a settlement for allegedly misrepresenting quality of loans used in mortgage-backed securities it sold prior to the 2008 financial crisis. The meltdown of the mortgage-backed securities market provided catalyst for that crisis and the subsequent recession. Wells did not admit liability in the settlement.
“We welcome the opportunity to continue to provide the Committee with information on these matters and to affirm our commitment to our customers, team members and communities,” Erika Reynoso, a spokesperson for the bank, wrote in an email.