Wells Fires Area Chiefs Over Sales Scandal -- WSJ
December 06 2018 - 3:02AM
Dow Jones News
By Emily Glazer
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (December 6, 2018).
Wells Fargo & Co. is firing around three dozen district
managers for oversight failures related to a sales scandal that
erupted in its retail bank more than two years ago, according to
people familiar with the matter.
Senior executives, including consumer banking head Mary Mack,
have briefed the Office of the Comptroller of the Currency on the
firings, one of the people said. The bank has sought to reassure
regulators it is fixing problems that have emerged throughout the
bank following the sales-practices scandal.
A Wells Fargo spokeswoman declined to comment. An OCC spokesman
declined to comment.
The firings mark the first wave of district manager terminations
following Wells Fargo's settlement with regulators in September
2016 related to improper sales practices.
District managers at Wells Fargo typically oversee anywhere from
five to 15 retail bank branches, depending on the area, the people
said. They largely were spared as the company fired some 5,300
employees related to perhaps millions of fake accounts that were
opened in pursuit of lofty sales goals.
Wells Fargo has spent the last two years dealing with the
fallout from the sales scandal. Since Sept. 2016, problems and
investigations have cropped up at business units throughout the
bank, including wealth management and foreign exchange.
Wells Fargo has struggled to convince regulators that it has an
effective risk management framework to catch and prevent problems
that could harm customers. In February, the Federal Reserve imposed
an unprecedented cap on the bank's growth. The OCC recently sent
rare warning letters to two of the bank's top executives, leading
Wells Fargo to place them on leave .
In recent weeks, lawyers for Wells Fargo have questioned dozens
of the district managers about activities or documents related to
sales practices, in some cases going back more than 10 years,
according to people familiar with the matter. Some district
managers, including bank veterans of a decade or more, were asked
about high sales numbers following a bank-approved "Jump into
January" sales program, one of the people said.
Some managers also were asked about human-resources complaints
that the bank already has investigated, the person added.
In 2017, Ms. Mack took steps to reorganize the retail bank,
including restructuring the regions in the western half of the U.S.
and rearranging executive positions. Wells Fargo has said it plans
to reduce its retail bank network to about 5,000 branches by the
end of 2020 through consolidations and divestitures.
Write to Emily Glazer at emily.glazer@wsj.com
(END) Dow Jones Newswires
December 06, 2018 02:47 ET (07:47 GMT)
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