Page 20 - Wells Fargo Bank (C) Case Study

Two days before the bank’s quarterly earnings

announcement, Stumpf announced his immediate
resignation. That decision came about a month after the

firm was fined the $185m for illegal banking practices that

resulted in the axing of 5,300 low-level employees. When

Stumpf testified in front of the Senate, Senator Elizabeth
Warren of Massachusetts told him that he demonstrated

“gutless leadership” in blaming the unauthorized accounts

on the 5,300 former employees.

Moreover, it was noticed that Stumpf did not resign after

settlements for any of the prior wrongdoing for which the

bank paid $11.3bn in fines since 2002. (5)

Penalty total since 2000: $11,365,854,147

Penalty Area Fine No

mortgage abuses $5,576,500,000 2

banking violation $2,466,932,386 13

toxic securities abuses $1,530,500,000 5

False Claims Act $1,200,000,000 1

anti-money-laundering deficiencies $163,500,000 3

securities issuance or trading violation $155,724,465 4

price-fixing or anti-competitive practices $148,000,000 1

investor protection violation $38,072,000 5

consumer protection violation $34,800,000 1

Americans with Disabilities Act $16,055,000 1