jump to example.com

Sen. Warner questions Wells Fargo on overdraft fees

mark warnerSen. Mark Warner (D-VA), a member of the Senate Banking Committee, joined colleagues in asking Wells Fargo’s chief executive to explain whether the bank’s recent surge in income from overdraft charges had any connection to the scandal over its fraudulent sales practices.

In their letter to Wells Fargo Chief Executive Timothy Sloan, the Senators expressed concern with a recent Financial Times report on how the bank’s income from overdraft charges grew by 7.5 percent between July and September. According to the Financial Times, that was five times faster than the rate of Wells Fargo’s main U.S. competitors – including JPMorgan Chase, Bank of America, TD Bank, and US Bank – which had an average increase of 1.3 percent during the same period.

“Even if these overdraft revenue increases are not directly related to the fraudulent account openings, we are concerned that they may reflect similar troubling consumer sales practices,” the Senators wrote in the letter. “It would be particularly distressing if Wells Fargo were pursuing an increase in revenue from overdraft fees to compensate for the bank losing customers as a result of the fake accounts scandal.”

The Senators also noted that Wells Fargo’s rise in overdraft over occurred at the same time the bank reached a $185 million settlement with the Consumer Financial Protection Bureau and other government entities over its phony accounts scandal. Wells Fargo was fined for illegal sales practices that included opening as many as two million fake accounts without customers’ knowledge or consent.

In September, Sen. Warner and Banking Committee Democrats to asked Wells Fargo to answer dozens of questions for the record to clarify and supplement the Sept. 20 testimony of the bank’s former chief executive, John Stumpf, before the Banking Committee. Wells Fargo’s response on Nov. 15 either ignored or provided insufficient responses to a host of the Senators’ questions. In several instances, Wells Fargo declined to provide direct answers, citing the ongoing investigation that its board launched on Sept. 27.

In their letter today, the Senators pressed Mr. Sloan for more information on Wells Fargo’s overdraft products, including a monthly breakdown of the bank’s overdraft income since 2007, and any policy changes dating over the last 18 months. The Senators also requested details on how many employees received pay raises for meeting sales goals related to overdraft products, and the number of employees disciplined for not meeting those goals.

In December of last year, Sen. Warner introduced legislation, the Justice for Victims of Fraud Act, that would provide customers victimized by Wells Fargo the opportunity to take the banking giant to court.

Discussion
 
Recent News
 

Your One-Stop Media Shop

Augusta Free Press LLC provides clients in the Shenandoah Valley and Central Virginia and beyond with marketing and PR solutions including web design, magazine/brochure, TV/radio, social media and overall marketing campaign design and implementation.
  • Web Design

    You want a new website, but don’t have the first clue as to how to build one. That’s our job. We take care of all facets of web design – visual design, layout design and content development. Get your business online for as little as $1,299.
    Learn more about AFP Web Design services.
  • Graphic Design

    The staff at Augusta Free Press Publishing has been recognized by the Virginia Press Association for excellence in layout and design. Whether you need a fresh business card design, rack card, ad, flyer or full magazine design, we can help with all your graphic-design needs.
    Learn more about AFP Graphic Design services.
  • Marketing

    Augusta Free Press manages advertising campaigns for small- and medium-sized businesses across Virginia. You don’t need to hire a full-time marketing coordinator. Bring the experience of the Augusta Free Press team to work for you – for a fraction of the cost.
    Learn more about AFP Marketing services.