SEC Probes Wells Fargo Over Sales-Practice Disclosures
November 3, 2016
The Securities and Exchange Commission (SEC) is probing whether Wells Fargo & Co violated rules around investor disclosures and other matters relating to its recent sales tactics scandal, the Wall Street Journal reported on Wednesday.
The SEC sent requests to Wells Fargo for documents in recent weeks, following senators’ calls in late September for the SEC to investigate whether the San Francisco-based lender misled investors while allegedly engaged in illegal sales practices, the newspaper said, citing a source.
Wells Fargo veteran chairman and chief executive officer, John Stumpf, abruptly departed last month bowing to pressure over the bank’s sales tactics that have damaged its reputation and put Wall Street under renewed scrutiny.
The misconduct, carried out by low-level branch staff to meet internal sales targets, shattered the bank’s folksy image and a raft of federal and state investigations followed.
The company in September, agreed to pay $190 million in penalties and customer payouts to settle the case involving the creation of credit, savings and other accounts without customers’ knowledge. About $5 million will directly go to customers, many of whom might have paid a small fee on the unwanted accounts.
A spokesman for the SEC declined to comment. Wells Fargo also declined to comment.
This article was provided by Reuters.