Elizabeth Warren Just Eviscerated the Wells Fargo CEO

“You should resign…You should be criminally investigated.”


The Senate Banking Committee conducted a hearing Tuesday about the massive scandal currently engulfing Wells Fargo. The word “fraud” was used repeatedly by senators on both sides of the aisle when describing the bank’s creation of millions of unauthorized bank and credit card accounts for existing customers.

Fallout from the account scandal continues to pile up. The bank is also facing an investigation by the House Financial Services Committee, subpoenas from the Department of Justice, and at least one potential class-action lawsuit.

First up at Tuesday’s Senate hearing was Wells Fargo CEO John Stumpf, who was grilled by the committee for almost three hours.

Massachusetts Sen. Elizabeth Warren—a longtime advocate for more stringent regulation of Wall Street—tore into Stumpf, describing the unauthorized accounts as a “massive, yearslong scam.” She asked Stumpf what he has done to take responsibility for his bank’s actions. “You have said repeatedly, ‘I am accountable,'” she said. “But what have you done to actually hold yourself accountable? Have you resigned?”

Stumpf avoided answering the question directly, prompting Warren to repeat her question, her voice rising, at least three times.

Warren proceeded to pummel Stumpf with more questions. “Have you returned one nickel of the money you earned while this scam was going on?” she asked. Stumpf evaded the question several times. (Stumpf said earlier in the hearing that he earned $19.3 million last year.) Finally, an exasperated Warren said, “I’ll take that as a ‘no.'”

She then asked if he’d fired any members of his senior management. Stumpf initially began by describing the firing of regional branch managers, but Warren stopped him, emphasizing that her question was not about low-level leadership but about the people at the top. Again, Stumpf’s answer was no.

When Warren asked Stumpf if he knew how much the value of his bank’s stock had gone up over the time that the unauthorized accounts were created and maintained, Stumpf replied the information was in the public record. “You’re right, it is all in the public records,” Warren said, “because I looked it up.” She continued: “While this scam was going on, you personally held an average of 6.75 million shares of Wells stock.” The share price went up by about $30 in that time frame, Warren pointed out, “which comes out to more than $200 million in gains, all for you personally.”

Warren ended her speech by calling on Stumpf to resign and for both the Department of Justice and the Securities and Exchange Commission to investigate the CEO. Here’s an excerpt of her speech:

You know, here’s what really gets me about this, Mr. Stumpf. If one of your tellers took a handful of $20 bills out of the cash drawer, they’d probably be looking at criminal charges for theft. They could end up in prison. But you squeezed your employees to the breaking point so they would cheat customers and you could drive up the value of your stock and put hundreds of millions of dollars in your own pocket. And when it all blew up, you kept your job, you kept your multimillion-dollar bonuses, and you went on television to blame thousands of $12-an-hour employees who were just trying to meet cross-sell quotas that made you rich. This is about accountability. You should resign. You should give back the money that you took while this scam was going on, and you should be criminally investigated.

You can watch Warren’s full questioning above.

This post has been revised.

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THE BIG PICTURE

You expect the big picture, and it's our job at Mother Jones to give it to you. And right now, so many of the troubles we face are the making not of a virus, but of the quest for profit, political or economic (and not just from the man in the White House who could have offered leadership and comfort but instead gave us bleach).

In "News Is Just Like Waste Management," we unpack what the coronavirus crisis has meant for journalism, including Mother Jones’, and how we can rise to the challenge. If you're able to, this is a critical moment to support our nonprofit journalism with a donation: We've scoured our budget and made the cuts we can without impairing our mission, and we hope to raise $400,000 from our community of online readers to help keep our big reporting projects going because this extraordinary pandemic-plus-election year is no time to pull back.

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