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Features/Scandals

Wells Fargo's Internal Investigation Will Last to Spring

November 22, 2016

Just like the guest in the movie, "Guess Who's Coming to Dinner," the Wells Fargo internal investigation seems to be an endless affair. We now learn that the review into the bank's aggressive sales tactics and illegal opening of customers' accounts - being conducted by independent board members and "many dozens" of Shearman & Sterling lawyers - is likely to go on until the spring. The outcome could eventually affect how the bank compensates executives, claws back pay and disciplines top executives. In the meantime, Wells Fargo is likely to hit the pause button on major strategic decisions like instituting branch closures.

 

"One development the board said it will review is a 2007 letter uncovered by CNNMoney that was addressed to former CEO John Stumpf warning of 'widespread' fraud inside Wells Fargo. The letter seemed to predict the scandal that Wells Fargo is dealing with today," CNN Money reports.

 

Wells Fargo also has to respond to charges that it's 'stonewalling' lawmakers after the bank failed to answer questions about its practices and sales culture. The ongoing investigation is given as the excuse.