Tim Sloan apologizes over fake account scandal; says he is able to usher in new culture at bank.
Federal lawmakers told the CEO of Wells Fargo on Tuesday he should be fired for the bank’s massive fake account scandal that was revealed last year.
Tim Sloan apologized several times during his fiery congressional hearing in front of the Senate Banking Committee but also engaged in several heated exchanges with committee members who demanded he lose his job.
"I am deeply sorry for letting down our customers and our team members," Sloan said. "I apologize for the damage done to all the people who work and bank at this important American institution."
Last September, 3.5 million fake accounts were found to have been created by the bank’s staff and 190,000 of the accounts incurred various fees and charges.
Federal investigators said a high-pressure culture at the bank encouraged workers to create the accounts to meet sales quotas.
Wells Fargo was fined $185 million by government regulators, but many lawmakers have called for additional penalties, including possibly shutting down the bank.
“You made money personally off of it,” Democratic Senator Elizabeth Warren told Sloan during one heated exchange. "At best, you were incompetent; at worst, you were complicit. Either way, you should be fired."
Sloan rejected the assessment.
Citing past corporate statements, Warren charged that Sloan was planning to lay-off staff.
"You're scaring people, and that's inappropriate," Sloan responded and asserted he is capable of instilling a new culture at the bank in the future.
"I’m not afraid to make hard decisions when it’s needed," he said.
Republicans on the committee also criticized Sloan’s decision-making.
"What in God's name were you thinking?" said Senator John Kennedy, adding, "I'm not against big [business]. With all due respect, I'm against dumb."
Consumers could face lasting damage from the scandal – many paid fees for accounts opened in their names without their knowledge, although Wells Fargo said it has repaid more than $5 million in refunds and credits. It is also likely the fake accounts could damage consumers’ credit scores.