The $3 billion payment includes a $500 million
civil payment to the Securities and Exchange
Commission, which will distribute those funds to
investors who were impacted by Wells’ behavior.
“Wells Fargo traded its hard-earned reputation
for short-term profits” said U.S. Attorney Nick
Hanna for the Central District of California.
Before the scandal broke, Wells Fargo was
considered to have a sterling reputation among
the big banks. Bank executives referred to its
branches as “stores,” and once had a policy of
trying to get each Wells Fargo customer to have
eight financial products with the company.
Behind the scenes, Wells’ top management was
pushing sales goals that were both aggressive
and unrealistic. Bank employees were berated
for not making bloated quotas, leading
sometimes to mental health breakdowns, and
ultimately resulting in many employees gaming
Wells Fargo’s sales system in order to meet the
targets. For example a number of Wells Fargo
customers, notably the elderly, were signed
up for online banking when they did not have
internet access.
The behavior by Wells’ employees caused
damage to customers’ credit scores and cost
some of them money in fees.
The documents that lay out the charges against
Wells Fargo lean heavily on the behavior of
“Executive A,” described as the head of Wells’
community bank business and the regional
bank division from 2002 until 2017. Carrie
Tolstedt held those positions during that time
period. Tolstedt was aware of employees using
fraudulent means to achieve sales goals as early
as 2004, according to the DOJ.