World’s largest bank fires 5300 for fraud. Exec in charge walks away with R1.7bn

Wells Fargo & Company – the world’s largest bank by market capitalisation – has been fined R2.6 billion ($185 million) for creating over 1.5 million checking and savings accounts and 500 000 credit cards that its customers never authorised.

The scandal was due to an incentive-compensation program for employees to create new accounts.

The bank has since fired nearly 5300 employees while setting aside R71 million ($5 million) for customer refunds of fees for accounts the customers never wanted.

Well Fargo made a profit of R286 billion ($20 billion) in 2015.

Carrie Tolstedt, who headed the department in question, will retire at the end of 2016 and receive more than R1.7 billion ($124.6 million) in stock, options and restricted Wells Fargo shares.

The Money Show’s Bruce Whitfield interviewed Vestact MD Paul Theron.

Scroll down for quotes from the audio below.

I’m a Wells Fargo shareholder and account holder.

Paul Theron, Vestact MD

Wells Fargo is not as problematic as some of the others.

Paul Theron, Vestact MD

I wonder if this sort of thing is going on in South Africa.

Paul Theron, Vestact MD

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Article brought to us by Old Mutual.


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