Ex-Wells Fargo executive fined $17M for participation in fraud involving fake accounts
The Office of the Comptroller of the Currency (OCC) imposed a $17 million fine on the former head of Wells Fargo's community bank for her involvement in the bank's fake accounts scandal.
Carrie Tolstedt was "significantly responsible for the systemic sales practices misconduct at the bank," according to the OCC ruling, and the bank's business model "imposed unreasonable sales goals on its employees, along with unreasonable pressure to meet such goals."
Tolstedt consented to pay the punishment on January 19, but Gregory Coleman, a senior deputy comptroller at the OCC, did not approve the order until March 9. The order was released in a press statement by the OCC on Wednesday.
The agency also imposed a ban on Tolstedt from working in the banking sector in addition to the penalties. She remained silent about the OCC's conclusions.
The OCC initially informed Tolstedt in January 2020 that she was facing a $25 million fine for her involvement in the fake accounts scandal. The agency declined to explain why the overall amount of the fine was reduced.
Wells Fargo opted not to respond.
Tolstedt is the most recent in a long line of ex-Wells Fargo executives to suffer repercussions for their involvement in the scandal from the OCC and other regulators.
John Stumpf, the former CEO of Wells Fargo, was also banned from the banking sector after paying a $17.5 million fine to the OCC in January 2020. In November 2020, the Securities and Exchange Commission (SEC) fined him $2.5 million for misleading investors.
Also in January 2020, Michael Loughlin, the bank's former chief risk officer, and Hope Hardison, its former chief administrative officer and director of corporate human resources, agreed to pay $2.25 million and $1.25 million in fines, respectively.
James Strother, a former general counsel, paid a $3.5 million penalty to the OCC in January 2021, and in September 2020, three other former executives each paid a penalty to the OCC totaling $1.675 million.
In February 2020, as part of agreements with the Department of Justice and SEC over the incident, Wells Fargo agreed to pay $3 billion.
By fLEXI tEAM