In the latest fallout from the Wells Fargo fake-accounts scandal, a federal regulator has barred former CEO John Stumpf from the banking industry and filed charges against five other high-level ex-officials, seeking $37.5 million in fines.

John Stumpf

Stumpf, who stepped down as CEO in October 2016 amid the biggest banking scandal since the financial crisis, agreed to the unusual lifetime ban as part of a settlement with the Office of the Comptroller of the Currency that also requires him to pay a $17.5 million fine.

“The sanctions against Mr. Stumpf are noteworthy because few top bank executives have faced penalties of this scale in recent years,” The Wall Street Journal said, noting that a lifetime ban on a CEO of a big bank “is unprecendented in the megabank era that started in the 1990s.

The OCC on Thursday also announced the charges against five former Wells Fargo officials including Carrie Tolstedt, who headed the community bank division that was at the center of the scandal.

“The bank tolerated pervasive sales practices misconduct as an acceptable side effect of the community bank’s profitable sales model,” the OCC said in a notice of charges in which it seeks to fine Tolstedt $25 million and the other four defendants $12.5 million.

As The Hill reports, the OCC’s charges “are the latest legal blow for Wells Fargo and its former executives over a toxic culture driven by bank brass centered on unrealistic sales targets and high pressure tactics.”

The bank admitted charging customers fees on millions of accounts opened without their consent or sold through misleading tactics. It has paid billions of dollars in fines and legal settlements and is operating under an unprecedented cap on asset growth imposed by the Federal Reserve.

In its settlement with Stumpf, the OCC said he, among other things, failed to adequately supervise Tolstedt “with respect to the community bank’s sales practices” and failed to respond to employees’ complaints “regarding pervasive sales pressure, fear of termination for not meeting unreasonable sales goals, and illegal and unethical sales activity across the community bank.”

Mark Wilson/Getty Images

, , , , ,

3 responses to “Former Wells Fargo CEO Banned From Banking”

Leave a Reply

Your email address will not be published. Required fields are marked *