Daily News: November 29, 2017

Wells Fargo Says WSJ Foreign Exchange Story Misleading


Wells Fargo strongly disputed the characterization of its foreign exchange pricing as being unfair and unfavorable to its customers, as alleged in a story published by the Wall Street Journal on November 28, 2017.

“We informed the Wall Street Journal that their story had fundamental inaccuracies before they published,” said Wells Fargo Wholesale Banking Head Perry Pelos. “We provided pricing data and other information that revealed inaccuracies in the story or that were counter to its negative portrayal of our FX business. Our points and views were either absent in the finished story or not taken seriously by the paper.”

Points in the story that the company takes issue with include:

  • The assertion that an internal review showed that out of roughly 300 fee agreements only about 35 companies were charged the actual price they had been offered for currency trades. Wells Fargo said that no internal review leading to that conclusion was conducted by the business. The company also took issue with the paper’s use of unnamed sources and an alleged conference call.
  • The Wall Street Journal also implied Wells Fargo is pricing FX transactions in the range of 1% to 4% (100 – 400 basis points). The Journal further suggested that such pricing was improper and outside of industry norms. Wells Fargo said it explained to the publication that wider-spread outcomes are not uncommon in smaller and lower volume FX transactions, depending on transaction size and type, but that such spreads are not reflective of pricing on the full range of transactions.
  • The Journal also reported that a bell was rung whenever a major sales transaction was completed. Wells Fargo said nothing like that has occurred for more than a decade in its FX business.

“While we have made some mistakes in the past, we always work to make it right for our customers, and invite them to reach out to us if they have any issues. But, in our view, the article’s characterization of our overall business practices and commitment to our FX customers is misleading and unfair,” said Wells Fargo CEO and President Tim Sloan. “We proudly serve thousands of customers in our foreign exchange business and are committed to helping them succeed.”