Wells Fargo president resigns ahead of House hearings
Wells Fargo President Elizabeth A. Duke (pictured) resigned following a scathing House of Representatives report that criticized the bank for being too slow to reform following a string of scandals banking to consumers.
Duke, a former Federal Reserve regulator. joined the Wells Fargo board in 2015. Audit committee chairman James Quigley has also resigned. He is a former Deloitte executive, who joined the board in 2013.
Quigley and Duke were both scheduled to appear before the House Financial Services Committee on Wednesday.
The pair said in a joint statement, “As markets face increasing volatility, a strong Wells Fargo is needed more than ever. We believe our decision will make it easier for the bank and the new CEO to turn the page and avoid distractions that could hinder the bank’s future progress.
Both were featured in a harsh, over 100-page report released by the House Financial Services Committee, which blasted the bank for widespread fraud in its consumer activities linked to sales targets too aggressive to recruit new customers.
Last month, Wells Fargo, the fourth largest bank in the United States by assets, agreed to pay $ 3 billion in criminal and civil penalties related to the scandal, which federal officials said reflected a “total failure leadership “of the American bank.
In 2016, investigators discovered that Wells Fargo staff, working under an aggressive incentive compensation program, had opened up to 2 million accounts receivable without the client’s consent.
Wells Fargo shares have fallen 30% in the past 12 months, nearly double the decline in the broader banking sector.
Charles Noski, the former CFO of Bank of America, will be the new president. He will work with Managing Director Charlie Scharf, who joined the bank in October from Bank of New York Mellon to undertake the biggest cleanup in the US banking industry.