Rep. Tulsi Gabbard Urges Justice Department, SEC to Hold Wells Fargo Executives Accountable
Washington, DC—Rep. Tulsi Gabbard (HI-02) delivered a letter to Attorney General, Loretta Lynch, and Securities and Exchange Commission (SEC) Chair, Mary Jo White, urging them to hold Wells Fargo executives accountable for fraud and illegal banking activity. A recent Consumer Financial Protection Bureau (CFPB) report revealed Wells Fargo employees created more than two million unauthorized checking and credit card accounts in order to meet their sales quotas. To date, only one Wells Fargo executive has resigned, and she has received $124.6 million in stocks and options upon her departure.
“Wells Fargo has fired over 5,000 people, yet no manager or executive at Wells Fargo has been held responsible for defrauding and cheating their customers. Those responsible must be prosecuted and held accountable,” said Rep. Tulsi Gabbard. “If there was collusion or efforts from senior executives to drive up stock value through these illegal actions, steps must be taken to hold those people responsible, ensure orchestrators of this scheme which was tantamount to theft, are adequately punished, and that proper safeguards are put in place to ensure this does not happen again."
Please see full text below:
Dear Attorney General Lynch and Chair White:
The continued abuses by the banking industry are deeply troubling. I am writing to express my concern over Wells Fargo’s widespread opening of unauthorized accounts without consumer’s knowledge or consent. These appalling and fraudulent actions have cost consumers millions of dollars through unwarranted fees and charges and have ruined many customers’ credit ratings. These actions are grievous violations and deserve immediate action and scrutiny.
As you know, the Consumer Financial Protection Bureau (CFPB) reported that nearly 5,300 Wells Fargo employees surreptitiously opened unauthorized deposit and credit card accounts to boost sales figures with the hope of receiving financial compensation in return.
Specifically, employees opened deposit accounts without consumer consent, transferred funds from authorized accounts to non-authorized accounts to gain sales credits, and created false email addresses that were used to enroll consumers to additional banking services without their knowledge or consent. Due to these harmful and egregious violations toward consumers, the Federal government fined Wells Fargo $185 million, including a $100 million fine from the CFPB, which is the largest in the agency’s history.
It is appropriate that the Department of Justice has opened investigations into this matter. While Wells Fargo has fired over 5,000 people, no manager or executive at Wells Fargo has been held responsible for defrauding and cheating their customers. Those responsible must be prosecuted and held accountable. Otherwise, Wall Street will continue to run rampant, knowing they can get away with stealing and fraud with no consequence.
Furthermore, I urge the Securities & Exchange Commission to follow suit and take action. If there was collusion or efforts from senior executives to drive up stock value through these illegal actions, steps must be taken to hold those people accountable and ensure orchestrators of this scheme, which was tantamount to theft, are adequately punished.
Thank you for your attention to this important matter, and I respectfully request an update on your efforts to address this troubling situation.
Member of Congress