In opening remarks on Tuesday, Wells Fargo CEO and President Tim Sloan testified before the U.S. House Committee on Financial Services on the ways Wells Fargo is attempting to reform through the ongoing transformation of its operations, leadership and culture. Sloan also updated the committee on the company’s efforts to compensate customers for past issues.
“Above all, Wells Fargo is committed to making things right for our customers and earning back the public’s trust,” Sloan said in his testimony. “Wells Fargo is a better bank than it was three years ago, and we are working every day to become better still. This is an ongoing commitment by all 260,000 team members — starting with me — to put our customers’ needs first; to act with honesty, integrity and accountability; and to strive to be the best bank in America.”
Sloan outlined how Wells Fargo is making things right with customers who were harmed, how the company continues to strengthen risk management and controls, and how Wells Fargo’s culture has improved since he became CEO in 2016.
He told the committee that Wells Fargo is compensating retail bank customers who were impacted by past retail sales practices issues. To date, the company has reviewed 165 million accounts going back 15 years, contacted more than 40 million customers — both individuals and small businesses — via 246 million communications and provided tens of millions of dollars in compensation to customers.
Sloan also said Wells Fargo has centralized companywide control functions such as risk, finance, human resources, compliance and technology for better oversight. Within risk, the company has three “lines of defense” — front-line risk, independent risk management, and audit — to ensure multiple layers of review and to improve internal oversight. It has also hired more than 3,000 new risk team members from outside the company since 2016 with plans to hire more.
Despite this positive report, House members of both parties responded with skepticism to the purported changes.
According to the Financial Times, committee members pressed back on Sloan, raising questions such as why regulators had yet to release the bank from its consent orders and why the bank has not followed peers and stopped extending credit to gunmakers.
The Times also quotes Maxine Waters, the new chair of the House committee on financial services, who questioned outright if the bank was simply “too big to manage.”
