Politics & MoneyInvestments

CFPB architect blasts Wells Fargo CEO for lax financial oversight

Warren calls out Stumpf's "gutless leadership"

The architect of the Consumer Financial Protection Bureau bemoaned the lack of prudent oversight exhibited by the chief executive officer of Wells Fargo in recent years.

Sen. Elizabeth Warren, D-Mass, called for the resignation of Wells Fargo CEO John Stumpf on Tuesday during his testimony before the Senate Banking Committee on the recent cross-selling scandal at Wells Fargo.

Warren suggested that Stumpf's personal Wells Fargo stock holdings increased in value by more than $200 million while this "scam" was taking place.

Warren asked Stumpf: "Have you resigned? Have you returned one nickel of the millions of dollars that you were paid while this scam was going on?"

The Senator also called out Stumpf for his "gutless leadership" through the scandal. 

Warren later blasted Stumpf for blaming low-level employees and firing only at the regional branch level, while leaving senior staffers untouched and unaccountable for the opening of phony accounts in Wells Fargo customer names.

Warren also called for Stumpf to face criminal prosecution by either the Department of Justice and/or the Securities and Exchange Commission for his role in what Warren and other senators repeatedly called a "scam."

The Consumer Financial Protection Bureau levied the largest fine in its history — $100 million — against Wells for these "widespread unlawful" practices of employees who opened more than 2 million fake accounts to get sales bonuses.

“I apologize to all of the American people and will make it right,” Stumpf promised, in response to the questions from Senator Dean Heller, R-Nevada.

For her part, Warren worked to create the CFPB, as mandated by Dodd-Frank financial reform.

In recent times, she pushed for the CFPB to wield greater regulatory power, especially as it relates to nonbanks in the mortgage space.

Recently, a former employee came out on the online forum Reddit to expose the culture of the bank that this employee caused Wells Fargo’s most recent scandal.

Read here to find out what really went on at the bank.

Click on the video below to see Warren's exchange with Stumpf in full, courtesy of CSPAN.

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