Washington, D.C. - U.S. Senator Pat Toomey (R-Pa.), in a Senate Banking Committee hearing this morning, grilled Wells Fargo Chairman and CEO John Stumpf for disturbing business practices that drove some of the bank's employees to open up accounts without customers' permission. Sen. Toomey asked Stumpf whether these activities amounted to fraud and whether they were orchestrated.
During the hearing, Sen. Toomey said:
"What we've been learning is so deeply disturbing at so many levels. First, we discover that Wells Fargo had a sales culture that was blatantly antithetical to what's best for customers; we discovered that management had far too few commonsense controls in place to prevent the kind of abuse that customers were subject to; we discovered Wells Fargo executives completely out of touch."
"Signing up customers for products when you know the customer doesn't want the product, failing to notify customers about these sham accounts opened in their name, this isn't cross-selling - this is fraud!"
"When thousands of people conduct the same kind of fraudulent activity, it's a stretch to believe that every one of them, independently, conjured up this idea of how they would commit this fraud. Isn't it very probable that there was some orchestration that happened at some level?"
You can watch Sen. Toomey's full remarks here.
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