MONEY

Wells Fargo CEO: 'We could have moved faster' on phony accounts

Joel Aschbrenner
jaschbrenn@dmreg.com

New Wells Fargo CEO Tim Sloan said Thursday the company’s senior leadership, himself included, should have acted sooner when it learned of the phony account scandal that has embroiled the company.

Wells Fargo President Tim Sloan speaks to the Des Moines Register Editorial Board Thursday, Nov. 10, 2016.

“We could have moved faster and made some additional changes,” he said in Des Moines on Thursday. “I think that is an important lesson here.”

In an hour-long interview with Des Moines Register reporters and editors, Sloan talked about the presidential election, the bank’s presence in Iowa and the effort to repair the bank giant's reputation.

In September, Wells Fargo agreed to pay a $185 million fine to settle complaints that community bank employees looking to boost their sales numbers created millions of checking and credit card accounts without customers’ approval. The company said it has fired about 5,300 employees for the practice.

Sloan said unauthorized accounts also were created for customers in Iowa, and employees here were fired for the practice. It was the first time Wells Fargo had confirmed the scandal reached into Iowa.

Wells Fargo found 12,630 accounts in Iowa that potentially could have been unauthorized, including 740 that incurred fees, according to a company spokesman. The average refund was $25.

Wells Fargo President Tim Sloan speaks to the Des Moines Register Editorial Board Thursday, Nov. 10, 2016.

Wells Fargo declined to say how many Iowa employees were fired.

Sloan said the company is working to repay fees and compensate customers whose credit scores may have dropped as a result of unauthorized accounts.

A Wells Fargo veteran of 29 years, Sloan was named CEO in October after former CEO John Stumpf retired amid the account scandal.

Asked about the presidential election, Sloan said he didn’t know if a Donald Trump administration would be good or bad for Wells Fargo, but added that he would support an effort to reform the tax code, something Trump has proposed.

“Beyond anxious, I’m eager to see what he does when he’s in office,” Sloan said.

Sloan rebuffed Democratic senators' latest accusation against the bank related to the unauthorized accounts.

Earlier this month, three senators asked Sloan in a letter if Wells Fargo had violated reporting requirements related to the firing of employees licensed to sell securities, which some media reported as broadening the scandal to include the company’s brokerage arm, known as Wells Fargo Advisors.

Sloan said it’s unlikely that more than a few dozen employees of Wells Fargo Advisors were fired for creating unauthorized accounts.

“There’s not a big issue there,” he said. “It’s a fishing expedition from my perspective.”

Sloan called analysts’ predictions that Wells Fargo would lose customers “wild speculation” and noted that the company has added more customers than it has lost since the settlement over the unauthorized accounts was announced.

During a trip to Des Moines on Wednesday, Sloan attended the opening of a Wells Fargo museum on Walnut Street, met with Gov. Terry Branstad and held a company town hall attended by about 2,000 employees at the Civic Center.

With about 14,000 workers in greater Des Moines, Wells Fargo is the largest employer in the region. Its residential loan division, Wells Fargo Home Mortgage, is based in West Des Moines, where the company recently completed a $100 million campus addition.

Sloan, whose son, daughter-in-law and two grandchildren live in Ames, said the company is committed to the region.

“Whenever we think about growing the company, Des Moines is always high on the list,” he said.