Elizabeth Warren Wants Head of Wells Fargo Fired

By Douglas A. McIntyre Updated Jan 11, 4:12PM EST · Published Oct 19, 7:00AM EDT

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Elizabeth Warren Wants Head of Wells Fargo Fired — © Wikimedia Commons

Senator Elizabeth Warren pressed the extent of the power of her office as she insisted that the CEO of Wells Fargo & Co. (NYSE: WFC) be fired. Some of the points she made to the Federal Reserve are accurate, even if her opinion that she has leverage over such a decision is not.

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According to her office:

United States Senator Elizabeth Warren (D-Mass.) today sent a letter to Federal Reserve Board Chairman Jerome Powell urging him to maintain the Federal Reserve’s growth restriction on Wells Fargo until the bank replaces CEO Tim Sloan with someone who is not deeply implicated in the bank’s misconduct. The letter states that the Wells Fargo Board of Directors cannot comply with the Federal Reserve’s requirements for rescinding the growth restriction if it continues to employ a CEO who served in senior management roles as the bank repeatedly mistreated its customers and employees.

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The Fed’s defenders often say it is important for the central bank to be cordoned off from political considerations. Warren assumes otherwise.

However, much of the trouble at Wells Fargo has happened on Sloan’s watch. Warren’s office points out:

The letter notes that Mr. Sloan served in senior management positions at Wells Fargo from 2011 onwards, including as Chief Financial Officer, head of Wholesale Banking, and Chief Operating Officer before being elevated to CEO in the wake of the fake-accounts scandal in 2016. During that time period, Mr. Sloan was involved with the fake-accounts scam – and defended Wells Fargo’s high-pressure sales goals despite knowing they had led thousands of employees to open millions of fake accounts – and helped oversee the bank as it engaged in nearly a dozen other significant consumer frauds. In just the eight months since the Federal Reserve imposed the growth restriction, there have been several new reports of misconduct at Wells Fargo during times when Mr. Sloan served in senior management.

Many observers believed that when the Wells Fargo board replaced shamed former CEO John Stumpf with Sloan two years ago this month, it should have picked an outsider. It did not. Wells Fargo’s woes have continued, along with punishments from the federal government. Warren wants to leverage these events into a bit of arm-twisting at the Fed. While that will not work, she has some points.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.