Notice by email or by letter to make sure that we know exactly and they know exactly what they opened. It seems like it took an awfully long time to impose those basic controls. I see im out of time. Thank you, mr. Chairman. Senator menendez . Thank you, mr. Chairman. Thanks for response. The letter you received asking for hearings. Mr. Stumpf, let me just say im personally appalled by the size, the scope, the duration and the impact of the scandal. And i must say that im shocked and incredibly disappointed by the response of wells fargos Corporate Executives. You and your chief Financial Officer have taken to the press and laid the blame squarely on low paid retail bank employees. While i dont excuse what they did by any stretch of the imagination, i find that despicable. Wells fargo touts to its customers that we will never put the stage coach before the horses. The bank recklessly rolled over 2 million of your customers in what is no way can be viewed other than a largescale scheme to boost, you know, your growth and whatever that meant for your shares and whatever that meant to your shareholders. You didnt fire 10 employees, right . You didnt fire 500 employees. You fired 5300 employees. Is that right . 5300 did not honor our culture. They were not located in one branch or one district. Is that right . That is correct. They were located across the country. Is that fair to say . That is fair to say. Now shouldnt the workplace actions of employees reflect the values of the institution, no matter what part of the country that theyre in . The i absolutely agree with that. Do you believe that Senior Executives like yourself are responsible for nurturing and honing a can companywide culture for your employees and your employees actions . Absolutely. So, this isnt the work of 5300 bad apples. This is the work and the result of sowing seeds that rotted the entire orchard. Through sales guides and employee training manuals, which i reviewed or more specifically demands from harddriving managers, you and your Senior Executives created an environment in which this culture of deception and deceit thrived. And yet, you know, i see this as a toxic combination of low wages. In response to senator browns question as what is an average atwells fargo made, you said between 30,000 and 60,000. How much money did you make last year . 19 million. Thats good money. Now thats good money. This is a combination of low wages punishing sales quotas and a grossly misaligned compensation throughout the banks organizational structure as is evidenced that you removed it. When you were holding these e ethics sessions did you ever specifically, seeing this information, begin to blip up on your radar screen and more specifically did you ever specifically say in those sessions we do not want to open accounts for our customers that they dont ask for . Did you specifically say that . Senator, i will get to that question. I want to go back for a second. When a team member opens an account thats not used, that does not help customer and does not help us. And the vast majority did the absolutely right thing. Did you specifically say i specifically said, yes, we do not push products. We sit down with our customer. We have a needsbased analysis and based on what we hear where the customer is in their Financial Journey we match products. Did you specifically say that, in fact, i dont want to see accounts opened for customers that they did not ask for . Absolutely. When did you say that . Ive said that many times in many town halls. Let me ask you. Miss tolsted made about 9. 1 million in salary bonus and stock awards. According to the average wells fargo banker teller average salary is 45,000 and wells fargo personal bavger is 37,560. So imagine do you know what the poverty wage is for a family of three . I do not have that in front of me. Let me share it with you. I didnt think you would. Its 24,300. For a family of three its 20,160. So imagine for a moment, youre a single parent working with two Young Children as a personal banker in wells fargo branch. Your base salary is somewhere in the 30,000 range. You have a harddriving boss breathing down your neck to meet rigorous sales quotas. You have to call into a call center when you dont meet those quotas. If you dont meet the quota one day, it gets carried over to the next day and you have a higher quota. Forget about the incentive of making more money. In essence, this is about losing your job. And you think that that environment was the appropriate environment to protect your customers and to have the culture that you portray here that wells fargo had . Senator menendez, i get your question. We have been reducing sales goals and bringing other goals into place even before we decided to get rid of the sales product goals and the vast majority, the vast majority loved love wells fargo. We go to our Retail Banking people, 15 of our people in survey its actually a census done by gala every year loved the environment in wells fargo and put the cusses first. I cant excuse the behavior of the 1,000. Its too many. But the culture is a very caring and collaborative culture. Let me ask you a final question. Hopefully the chairman will have a second round. Did you or any Senior Executive atwells fargo suffer any financial consequence as a result of whats transpired over the years . The board will take first of all to date have you suffer any financial consequences . The board has gone through and, yes, people have been held accountable. Senior executive management . Senior executive management. I would like for you to classify for me what that is. People that are in charge of risk in the retail bank. People that are in charge of sales efficacy, regional president s who dont meet their goals around proper sales. Yes. People are held accountable and they will be held accountable. Mr. Chairman, thank you for holding this hearing. And for our witness for being here today. I appreciate it. For years, people of nevada have struggled to regain what they lost in the aftermath of the housing crisis. And we all know that this housing crisis was caused by greed and excess. For too long nevada often has had the unfortunate distinction of having one of the highest rates of unemployment, foreclosures, underwater homes, homes sold at short sales and personal bankruptcies. So trust, to me, is the center point of any relationship with the business. And i assume its the same that wells fargo has broken that trust. I consistently fight to ensure nevadans retain their personal privacy so i was shocked to hear the reports. Mr. Chairman, that the employees of wells fargo opened millions of Bank Accounts and credit cards without customers consent. The alcohols directly took money from americans pockets in order to artificially inflate company quotas. Ive had a number of constituents call my office this one happened to be from henderson, nevada. Emailed me. She was affected by wells fargos tactics. She was insulted that leadership atwells fargo was unaware of these policies. Given the culture of wrongdoing that some of your employees exhibited, taking responsibility, refunding customers and conducting internal investigations should only be the first step as we plan to fix this mess. Accountability, reform and putting your customers interests first should be wells fargos top priorities. With that, mr. Stumpf, just a couple of questions. To my constituents, have a right to be insulted. Ive heard a number of comments. Probably more directed at you, that you take Sergeant Schultz position that you knew nothing as this was moving ahead, that perhaps you even took i heard this from one of my constituents, Hillary Clinton approach, what difference does it make attitude. Let me tell you why theyre talking this way about your letter to your valued customers as you tried to explain to them some of the problems. Some wells fargo customers received products and services that they did not need. You didnt tell them you were sorry in your Customers Service letter. You came to this committee and told us you were sorry but you didnt tell your customers you were sorry. Do they have a right to be insulted . Well, first of all, let me tell you, i had a number of Media Contacts last week. One broadcast in and four in print. I am sorry. I was even misquoted or misunderstood in one where i blamed team members. I dont like we dont accept behavior thats not consistent with our culture. But i do accept responsibility. And i am sorry. This letter appears that youre downplaying some of the concerns. You said some wells fargo customers. Were talking almost 2 million accounts that were opened up. Let me ask you this question. Was anybody on your board or yourself did any of you have any opened, unauthorized accounts in your names . I dont know that. Ive not seen a letter and i was not refunded any of the dollars. What would you have done if you had an unauthorized account, somebody forged your name . What would you have done about that . I have done that before where people have forged my name or stolen my identity. But, of course, i would be very disappointed and i can surely understand your con ststituenco disappointment. We have a lot of work. Nevada is a very important state to us. Weve been there a long time. I apologize to the American People and all our customers. Well make it right. Can i go back to carrie tolsted for the moment . Youre not on the compensation board. If the compensation board were to send you a recommendation to approve 100 million or compensation package for her, would you support that . You know, im not on that board and i think its probably if i could take a second, as i understand and ill get you the information about her 100 million. Its part of it is stock she has purchased in the open market or exercised and owns for a 27year career. There are some dollars that are in the money, options she has not yet exercised. Finally, there is a part of future grants that will be vesting over the number few number of years. And the board will consider all of those things. Theyll consider her entire situation in their deliberations. Would you approve that . You know, again, senator, i want to be respectful of the committee and respectful of their process and not in any way bias their decision. Mr. Chairman, my time has run up. Thank you. Mr. Chairman, senator brown thank you for having this hearing. You have done something that has never happened in the last ten years and united this committee on a major topic. And not in a good way. Credit card accounts were opened. Folks didnt know about them. There were fees charged, potentially fines charged. And if customers were aware unaware that these accounts were opened up, there must have been many instances 2 million accounts were opened up, that negative information was sent to Credit Bureaus. Is that accurate . The part thats accurate is there are 565,000 credit cards that were opened up that were never activated. About 400,000 of those have customers signatures on them. And 5. 7 less than 6 of those accounts that we opened at that time were not activated. Pretty standard industry because people might have them. Were going to go back to each one of those customers now and find out if that was a legitimate signature and open. If its not well make it right. Thats not what i asked. I asked was negative information turned into the Credit Bureaus because of these alcohols . You know, i dont know the algorithms of how i want to answer your question. I know that when a Credit Bureau is requested, it has an impact on your credit score. This is a big deal. Yes, it is. Im telling you, it is a big deal. I could ask you for the age breakdown on these 2 million accounts that were opened up, but i am telling you that if information was sent into the Credit Bureaus because of these falsely opened accounts, the impacts on this are far, far, far more than the fees or fines that could be associated with that. What is wells fargo doing about that . Or did that information not get reported to the Credit Bureaus . Well, when we pull a credit just ask me just tell me. Did the information, if there were fees and fines involved and the Credit Bureau is requested or even if they didnt, did that information get forwarded to the Credit Bureaus . Im trying to sir, im trying to work with you. Yes or no works. Yes. We pull a Credit Bureau for each one of these cards. Okay. So what is wells doing about fixing that problem . Be concise. We are calling each credit card customer to find out if this truly was a card they wanted. If they want it, we dont want to take away their credit. If they did not want it, were going to go back and make sure that its made right by the Credit Bureau and made right by the customer. And whats the timeframe for that . We already started that process. Okay. So now this took five years. Its been documented. 2011, maybe even started before that. But 2011 till fairly recently. Now, if i had had a credit card issued in the first volley and in the meantime between 2011 and now, i decide to buy a house and that information was reported to the Credit Bureau, it could make you probably could know the figure but maybe half a percent, maybe more than that. And on a 500,000 mortgage, difference between 3. 5 and 4 is 50 grand over 30 years. Whats being done about that . We will look at each one of those and determine youre going to go back in and determine, even if they didnt do business through wells, if they bought a house and what wells did impacting their Credit Rating youre going to go back and find those folks . Weve committed to go back to all of our credit card customers and find out what about the ones that got you refund all their fines. You refund all their fees. You went back to the Credit Bureau and reestablished their Credit Rating as of today. What about the folks that may have bought a house through chase and got a higher Interest Rate because of it . How are you going to find those folks . Were working on that. Ive told our people go back and make it right. And i can as we start going through that, im happy to have our team come back and report to you how well work it out. I think its really important that you understand that this is a big deal. I mean, its a big deal. I know you feel bad about it. We feel bad about it. But the truth is, theres real world implications here on young families and old families that are going to be put into a poverty situation because of this. Even though we think its just a few hundred bucks in fees. Its more than that. Much more than that. So, you found out in 2013 and i dont want to beat this horse anymore, but did you find out that they were actually setting up accounts with fraudulent signatures in 2013 . You know, i learned that some of our team members were not doing the right thing and they were opening accounts on customers and then we truncated those. If you guys knew about that, a simple edict would have been very helpful. Dont this. If you do this, youre gone. And thats we have even more than that. And what we should have done is got rid of our incentive program. The last thing its a statement and its not. 5300 people went and thats basically 1 of your workforce. Every time you say that, you give ammunition to the folks who want to break up the big banks. 5,300 people are more more people that live in most towns in mountaina. 2 Million People is twice the population of the entire state. This is a major screwup that went on for far, far, far, far too long. I think you know that. But, man, theres going to be a lot of work that has to be done to rectify the situation if it ever can be rectified. Thank you, mr. Chairman. Mr. Stumpf i want to follow up on the line of questioning that senator tester was just discussing with you. First i want to ask a couple of questions about data, basically. Consumers expect that their private information is going to be protected at their bank and not used to open an unauthorized account. Youve gone through that extensively today. Did the Third Party Analysis that you engaged in determine if these unauthorized accounts were created uniformly across the you state or were there areas in the United States where they were more heavily created . Yes. There was a more heavily bias toward the southwestern part of the country. The information i have indicates that even more specifically includes california and arizona. Would that be correct . That would be correct. I also have new jersey here on my list. Was new jersey more heavily impacted . Well, i have numbers by state. And it typically related to there was some overindexed or o over people did more wrong things. More sizes of the bank, places where it was larger and fit more the pattern of the size of those organizations in those communities. Because of that, it wasnt necessarily that the management in those communities were potentially the ones who were driving this more aggressively but simply the size of your business in those communities . Senator, it was a bit of both. All right. Thank you. Obviously, one of the questions that my constituents and constituents across the country have, am i one of those who have had an unauthorized account created in my name . Right now wells fargo is calling every customer, is that correct . We are contacting all of our deposit customers and credit incidentally, virtually all of these accounts came on the books and were closed within a 60day period. So, of the potential again, 2 million accounts that could not be eliminated i think i said that in my oral testimony. I dont know. We just couldnt eliminate them. Pwc could not. But were calling all of our credit card customers and contacting all of our deposit customers. And we have a special callin number. Were asking people to come into our banks and talk to our people. That was my next question. If theres somebody who doesnt want to wait for the call, what can they do . Theyll get a notice and say if you you can email us. Well call you, do whatever it takes to make sure that i know our study was pwc was very comprehensive. We tried to err on the side of the customer. In fact, were getting people coming into our bank today saying ive got a 25 check but i wanted this service. And im not saying that. But im just saying that we want to make sure that we dont hurt any customer and that if they wanted credit, they have it. If they didnt want it, well try to make it right by them. Getting back to senator testers question about the credit impact, the simple opening of an account causes an impact to a Credit Rating, doesnt it . It does on again, im not an expert in this field but i know on the credit card side we pull a bureau. I know that is a strike against lowers your credit score depending how many requests are in that time. Theres also a positive impact. And im not here to justify or under we will do whats right to make that right. Thats what i want to get at in the last minute i have in my questioning. You said to senator tester and again to me, that youre going to make it right. How do you do that . You said the calls have been being made. Im assuming in the calls the bank is making they are finding customers, some, who have unauthorized and unwanted credit card accounts. How do you make it right, the damage that has caused that credit card holder . That is a very good question. Were just starting that process. I dont have enough to give you right now. Well be happy to come back to the committee and tell you more about what we learn as we do that. Thank you. In the little bit of time i have left i want to shift topics. My understanding is that the primary regulators that you have been dealing with are the city of los angeles and the occ and the cfpb. Is that correct . That is correct. Could you give me a timeline . When did each of those notify you or did you notify them at some point . In what order did they get involved and when . The city of los angeles lawsuit was sometime in the may timeframe of 2015. 13 maybe it was. Im sorry. Im missing on dates here. And then the occ was involve d. We shared with them. We learned of their lawsuit, we well, it was actually in 15. Im sorry. 2015, may of 15. We shared that information with the cfpb. But the occ was involved with us probably in the 2013 timeframe. Occ would have been involved first, even before the city of los angeles . They are our principle regulator and, yes. Cfpb would have been the final entity that was the last entity . We noticed we called them. Someone from our Legal Department called them, i believe, in the may timeframe of 2015. Sorry. I see my time is well over now. Thank you, mr. Chairman. Senator warren . Thank you, mr. Chairman. Mr. Stumpf, wells fargo vision and value statement which you frequently cite says, quote, we believe in values lived not phrases memorized. If you want to find out how strong a companys ethics are, dont listen to what its people say. Watch what they do. So, lets do that. Since this massive years long scam came to light, you have said repeatedly, quote, i am accountable. But what have you actually done to hold yourself accountable . Have you resigned as ceo or chairman of wells fargo . The board i serve have you resigned . No, i have not. All right. Have you returned one nickel of the millions of dollars that you were paid while this scam was going on . Well, first of all, this was by 1 of our people. Thats not my question. This is about responsibility. Have you returned one nickel of the millions of dollars that you were paid while this scam was going on . The board will take care of that. Have you returned one nickel of the money you earned while this scam was going on . And the board will do i will take that as a no then. Have you fired a single Senior Executive . By that, i dont mean regional manager or branch manager. Im asking about the people who actually led your Community Banking to visibank i Compliance Division. Im not asking regional managers or branch managers. Im asking if you fired senior management. The people who actually Led Community banking division, who oversaw this fraud or the Compliance Division that was in charge of making sure that the bank complied with the law. Carrie tolsted did you fire any of those people . No. You havent resigned. You havent returned a single nickel of your personal earnings, you havent fired a single Senior Executive. Instead evidently your definition of accountable is to push the blame to your lowlevel employees who dont have a money for a fancy pr firm to defend themselves. Its gutless leadership. In your time as chairman and ceo, wells has been famous for cross selling, which is pushing existing customers to open more accounts. Cross selling is one of the main reasons that wells has become the most valuable bank in the world. Wells measures cross selling by the number of different accounts a customers has with wells. Other big banks average fewer than three accounts per customer. But you set the target at eight accounts. Every customer of wells should have eight accounts with the bank. And thats not because you ran the numbers and found that the average customer needed eight banking accounts. It is because, quote, eight rhymes with great. This was your rationale right there in your 2010 annual report. Cross selling isnt about helping customers get what they need. If it was, you wouldnt have to squeeze your employees so hard to make it happen. No. Cross selling is all about pumping up wells stock price. Isnt it . No. Cross selling is shorthand for deepening relationships. Let me stop you right there. You say no . No . Here are the transcripts of 12 Quarterly Earnings calls that you participated in from 2012 to 2014, the three full years in which we know this scam was going on. I would like to submit them for the record if i may, mr. Chair. Thank you. These are calls where you personally made your pitch to investors and analysts about why wells fargo is a great investment. And in all 12 of these calls, you personally cited wells fargos success at cross selling retail accounts as one of the main reasons to buy more stock in the company. Let me read you a few quotes that you had. April 2012, quote, we grew our Retail Banking cross sell ratio to a record 5. 98 products per household. A year later, april 2013, quote, we achieved record Retail Banking cross sell of 6. 1 products per household. April 2014, quote, we achieved record Retail Banking cross sell of 6. 617 products per household. The ratio kept going up and up. It didnt matter whether customers used those accounts or not. And guess what . Wall street loved it. Here is just a sample of the reports from top analysts in those years. All recommending that people buy wells fargo stock, in part, because of the strong cross sell numbers. I would like to submit them for the record. No objections. Thank you, mr. Chair. When investors saw good cross sell numbers, they did, while this scam was going on. That was very good for you personally, wasnt it, mr. Stumpf . Do you know how much money, how much value your Stock Holdings in wells fargo gained while this scam was under way . First of all, it was not a scam. And cross sell is a way of deepening relationships. When customers weve been through this, mr. Stumpf. I asked you a very simple question. Do you know how much the value of your stock went up while this scam was going on . Its all of my compensation is in our public do you know how much it was . Its all in the public filing. Youre right. It is all in the public records because i looked it up. While this scam was going on, you personally held an average of 6. 75 million shares of wells stock. The share price during this time period went up by about 30, which comes out to more than 200 million in gains, all for you personally. And thanks, in part, to those cross sell numbers that you talked about on every one of those calls. You know, here is 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 probably would 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 by both the department of justice and the securities and exchange commission. This just isnt right. A cashier who steals a handful of twenties is held accountable but wall street executives who almost never hold themselves accountable. Not now and not in 2008 when they crushed the worldwide economy. The only way that wall street will change is if executives face jail time when they preside over massive frauds. We need tough new laws to hold Corporate Executives personally accountable and we need tough prosecutors who have the courage to go after people at the top. Until then, it will be business as usual. And at giant banks like wells fargo that seems to mean cheating as many customers, investors and employees as they possibly can. Thank you, mr. Chair. Senator vitter . Mr. Stumpf, what astounds so Many Americans and virtually all of us is how significant this fraud was, how widespread it was for how long a period of time. And related to that, im very concerned about this time line of when top corporate leadership like yourself knew about it. You have been talking, in general, about 2013. Is that when the issue was a focus of board discussions or was that the first time you knew of fraudulent activity and these unwanted accounts being opened against customers wills . As i thank you, senator vitter. As i testified before, people in our Regional Bank knew that not every team member would do everything right every day. And they tried to root it out at the business level with their compliance and so forth. And at once when did you and folks at your level, like board members, know of this activity on any significant scale . Was it 2013, which you had suggested, or was it earlier . 2013. Okay. So in 2011, about 1,000 employees were fired over this. Thats about 1 of the whole Retail Business. So, 1 of a whole big part of your business was fired over fraud. And you were never told about that . That was dealt with in the Business Unit at that time. Is it normal for 1 of a Business Unit to be fired over fraud, not high turnover, not incompetence fraud, and this never is mentioned to you . Yeah. In a large Retail Business that has other turnovers and so fo h forth, if i could go back, i would have, you know, spent more time on this. Why isnt this Crystal Clear proof that an entity as big as wells is not only too big to fail but its too big to manage and its too big to regulate . 1 of a big part of your business is fired over fraud but that doesnt rise to your level . Senator, thats a good question. Ive thought about that. This was a problem of focus and not of size. Lets talk about Corporate Culture. Youve often referred to people not living up to the wells culture. Culture is not something written in a handbook. Culture, as has been suggested, is an atmosphere and what is lived. I agree. Wasnt this practice, in fact, by the numbers part of the wells culture, by definition . Because it was so widespread for so long a period of time . I think this is not part of our culture. This was the again, its a large number. But i the vast majority of our people do it right every day and they provide great value and they live according to our culture. And a widespread practice for many years. Ill just make a statement. That makes it part of the culture, in my opinion. So, it seems to me your challenge is to change the culture, not to enforce the culture. Well finally, what level of confidence from 0 to 100 do you have that this type of fraudulent activity does not exist in other wells business lines . Weve looked at other things, other businesses. Theyre different. N that we believe this is situated in our Regional Bank. Other areas have Different Levels of compliance and different volumes and different requirements. But weve looked across a number of things and i have the confidence that we have this one now solved and weve made a lot of changes. Just as an example, wells is the biggest participant in the sbas 7a loan program. I happen to chair the Small Business committee. Im focused on a lot of Small Business issues. Are you 100 confident that no fraudulent activity like this or no extreme quotas and goals exist in that 7a program . We dont have product goals, to my knowledge, in any one of our other businesses. And we have of course, because of this situation, weve doubled down on compliance and review in a lot of our businesses across the board. Well, im writing several of those compliance folks to urge a look at anything Small Business related, including the 7a prachl since wells is the leader in that activity. Thank you, mr. Chairman. Senator donnelly . Thank you, mr. Chairman. Mr. Stumpf, you probabeviously talked to me about wells fargo values. Look at the mess we are in. A Community Banker from my state called the office, unsolicited, and just sick. And he said here we go again where my bank is a local community bank. My bank will be slanderred because of what these guys are doing. And he said, if my bank had a widespread practice of opening unauthorized accounts and moving customer money without permission, i would be in jail. My bank would be sold and my entire Management Team and board would be sued by the regulators for a lack of oversight. And he is sick to his stomach about what has happened here. And so am i. Over 5,000 people from indiana, 5,000 hoosiers who, every day, as everybody has talked about from their own states. Every day, these people work nonstop to try to pay the bills, take care of their family, make sure that they can make ends meet. And they hope that they can. Over 2 million plus across the country. But over 5,000 hoosiers who had unauthorized accounts opened. Now the second many of these credit cards are opened, these folks credit was immediately dinged, something senator tester was talking about. Then you go to take out a mortgage. You got a 30year mortgage at half a point or point higher because your Credit Rating has gone down. What i want to know in one of these things, will you pay back every single extra dime that these people are going to incur over the 30 years because of the fraudulent action of the people atwells . It wasnt sam or judy who works at the mill, who was hoping to get a payment that they could afford. It was that their account had fraud committed to it. Every single month for the next 30 years. How do you pay that back . Thank you, senator. Weve been thinking about that. Were starting to make those calls to our constituents and find out our customers and i dont have a final answer for you. But we will our attention is to make it right by every customers. So do you promise to pay back every single extra dollar these people are going to incur over the next 30 years . Senator, i want to work with you. Im trying to be cooperative. I just dont have all those answers for you today. I surely will get the issue. My instructions have been to make it right by every customer. One of the things that rubs everybody wrong around here not just here, around the country. Americans are fair people. And everybody in this country t tries to make sure that theres a square deal done. Its not a square deal when the people that are fired are the tellers who make 15 bucks and the senior execs walk off with 100 million. Americans can smell an unfair deal a mile away. And when this teller these 5,300 tellers, they didnt come up with this scheme on their own. This is the only way they could keep their jobs, because of what was going on. And you called them dishonest. And my question is, carrie tolsted, the head of all of this, is she dishonest . How do you fire someone making 15 bucks and not the person thats like firing the guy throwing coal in the engine and letting the captain go strolling off to 100 million new ship. How do you do that . I think thats an important question. First of all, most of the people were bankers who were not making 15 an hour. Managers of those and managers of those. And theres something very different about violating our code of ethics and putting customers at risk and being dishonest versus someone who did not spend enough time making sure that this issue had been closed. I see a very big difference. One of the things that the American People are just disgusted about is it seems like it all flows downhill. And the people down the hill get fired, dont even know if they can even then pay their mortgage because the job they had is gone. And the people at the top of the hill make 20 million, 10 million. You know, the fellows who started the Wells Fargo Stage coach, this was not their plan. This is not what we do. And the only last question i have, and i apologize, mr. Chairman, but its this. For five years five years and so when folks say this too big to fail for five years, you were not able to end this. And you look and you go for five years, americans were taken advantage of and were cheated. Had their Credit Ratings ruined. Had accounts opened that they never even knew about. And this bank either you didnt know or you knew and it was great for the story. You know, under any circumstance, none of conclusions is good. I couldnt agree with you more. We did not move fast enough. We should have done better. But i also want to remind you that the vast majority of people also had families to feed and did exactly the right thing. But we are sorry and we need to do better. Thank you. Thank you, mr. Chairman. Thank you, mr. Chairman. Good morning, mr. Stumpf. Good morning, mr. Scott. Senator scott. I will tell you, as a senator, im frustrated, angry and really unhappy with what appears to be a toxic culture in parts of your sales organization. As your customer with two or three mortgages, a couple of accounts, im disappointed. Im disappointed in my Financial Institution that ive put so much confidence and trust in. I am, however, thankful for the real heroes that weve heard so little about this morning. The heroes, the employees who went to the press, the customers who went to the occ, bringing oxygen to a very important conversation and hopefully resolution. I ask myself, and perhaps rita morillo gives me the answer. Why did not these employees find a safe haven up the chain . If you will remember, i owned a couple of all city sales agencies. The sales culture that was so toxic is also incredibly important for folks looking to support their families, who are working paycheck to paycheck and anyone who suggests that folks who make just a little money must cheat the system is inconsistent suggestion. I know a lot of folks who are poor who would find that comment quite disrespectful. Lots and lots. Most poor folks have strong integrity. And would never put themselves in this situation. I would suggest that perhaps the higher you go in that chain and the sales organization, the more you find the problem. Not the person making the 15 bucks an hour, to be honest with you. My question, though, is why was there not a safe haven . Have you created safe havens for employees who see things that are just running amuck . Do they have a safe place to go . Not to the l. A. Times. Not to the occ. But is there a culture that is being established . I know youre eliminating some of your sales goals that have unintended consequences as well. Is there a culture being established where the average employee feels empowered, encouraged to come forward and speak and be heard in wells fargo . Senator scott, i really appreciate that line of questioning. Because its absolutely and i should have mentioned it. Each team member, no matter where you are in our organization is encouraged to raise their hand. If something is being asked of them, that they think is not right, not consistent with our values and our culture, theyre asked to raise their hand. Theyre asked to go to a managers manager in hr. We also have an anonymous ethics line. They can speak up and show us and talk to us. We want to hear from them. Because we dont want this behavior. And i wish, you know, we would not have we also today have an email within an hor of opening an account. No account gets can get open today on a deposit side or credit card without a signature, and were also doing a big Mystery Shopping program to help tie it together. This is important for me to finish my line of questions. Im glad to hear you are making progress. Mr. Chairman, i would love for the record to have a better understanding of the culture of checks and balances that were not there that are now there that will help thousands of customers throughout South Carolina have more confidence in all Financial Institutions and perhaps having done it wrong, you become a model for being doing it right. Thank you. The second question i have goes back to the question we have heard from crepo, from tester, and so many others that donnelly when you look at the impact on the consumer, the customer you open an account i apologize for going over my time for a minute or so. You have account. I have a couple with a bank. Thank you. I hope to keep them there. Thank you. We agree. I hope to keep them there. Yes. Someone opens an account fraud lent account. The definition of fraud lent, god bless if i didnt sign for it, its fraudulent. I like the simple definitions. Opens an account in my name. I dont know the account is open. So there are fees attached to some of the accounts. The fee that is are attached arent paid because im ignorant of those accounts. Those fees that are not paid because i dont know about them at some point is reported to a Credit Agency because i didnt pay the fees because i didnt know about it because i didnt open the account. When these fees that creates a negative impact on my credit statement, it translates into higher Interest Rates or said differently, a different way of exacting resources out of my very limited pocket. Especially for folks working paycheck to paycheck throughout South Carolina. Dloo correct. So when that happens, it is nearly impossible for us to figure out the actual dollar amount as senator donnelly was looking for of impact on all the customers it goes to. I would also like for it to be included in the questions for the record some way of helping me and others understand how we create a solution for those customers who will be identified by you or a group of attorneys looking to sue, so i would love to understand and appreciate that process so i can go back to my constituents who i work for and give them a plausible path forward for actual resolution for those who are injured and a clear path forward for restoring confidence in Financial Institutions because my fear is that this is not going to simply be a wells fargo question. It will be a question for the entire financial footprint in our nation. I i think its a good point, and i think again, i only did check with our team, but i think weve already gone back on the deposit side and made those fixes with the Credit Bureau and are working to rectify that, but ill make sure we get back to you on the work with you on that issue. Thank you, sir. Thank you, mr. Chairman. I think this is a critical time as we look at the push that weve seen from so many Financial Institutions for lower regulatory burdens and trust us. What weve now lost has been trust not only between you and your customers, but between in a very bipartisan way between this committee and large Financial Institutions. You have said repeatedly that one of your failures was that you did not act fast enough. Today youre sitting in front of this committee, and im telling you, you are still not acting fast enough. You still do not have the answers that we need to say that were moving forward. Lets start by taking a look at refunds, restoring the customer to the customer what the customer lost. You have said repeatedly to the folks here, you know, were working on it, were working on it. You know, we start this story as far back as we dont know, but lets start at 11 00. At 11 00 theres something going on, and wells fargo is addressing. At 13 something is going on, and wells fargo is going on. At 15 wells fargo is addressing it and theres something going on. Yet, it didnt get done. Now youre coming to us and saying trust us we now get it. Now we know. Now we figured it out. We need a clear dialogue, but i think that one of the failures today is you havent come with a whole lot of remediation. You havent come with a whole lot of dialogue to us on this is what were doing to restore Customer Confidence and like senator scott im one of your customers. My whole family is. You arent doing what you are also not doing what you need to do to restore confidence with this committee and with all the american public. We want to talk about changing can you will tour. 4,000 people independently act with impunity and with dishonesty. No one here believes that. If they do, ive done law enforcement. This is this is a behavior that was created by the culture that was allowed. Created by a whole lot of folks saying, you know, lets do it this way. This is not i get what you are saying that it wasnt just the tellers. It wasnt just the lower level. But, yet, the one person the one person who was responsible directly other than yourself for making sure this doesnt happen isnt in front of this committee today. In fact, shes walked off with a pretty good deal and hoping that all of this blows over, and the other thing when you say you didnt act quickly enough, the board should have already acted to claw back those salaries. If you had come here and said the board now is clawing back, these are the things that were doing, and you would be in a lot better position sitting in that chair right now. I will tell you have not done enough to restore confidence today, and this dialogue will continue with this committee and with the american public. Now with that stead i want to turn to the 5,000 people. I want to say maybe they deserve to have their reputation restored. Maybe they deserve to not be that person who is now resume says fired on a resume. Maybe instead of just focussing on your customers, you ought to focus on the 5,000 people who im pretty sure did not unilaterally decide to be dishonest. Its an issue that hasnt been raised here, but i think its a critical issue because when you punish the guy at the end of the line and you dont punish in any way someone at the top, we end up with an attitude that quite frankly this is a Corporate Culture that doesnt care. Theyre just trying to get through the day. I dont think that your day yet has ended wrush i want to thank you for appearing, but its not enough, and its not nearly what i had hoped you would come with today. Mr. Chairman, thank you. As i understand the circumstances, the factual circumstances, many of the problems while they were systemwide, many of the problems were focused in the Los Angeles Area within your baining system. Is that true . Its true that thats the largest part of our business, but they were also focused there. Yes. Have you analyzed sufficiently to determine what was different about los angeles than places elsewhere within your Banking System that would suggest that the number of times the volume of fraudulent acts that occurred there, how do you explain that . Well, senator ikam said and if i did not share this, i want to say i also agree 5,000 people just dont do 5,000 random things on their own. Im sure there were people talking to one another within a branch and so forth, but that analytical work is being done and has been done. I dont happen to have it here, have our teamwork with your staff to make sure you have whatever you need on that. I would welcome that. Im interested in knowing if you see this as a customer issue, a more vulnerable population of banking customers or as the word culture has been used here a number of times, was there Something Different about los angeles, which i assume, again, i again, i think illegal behavior, immoral behavior, breaking the rules and wrong wherever it happens, but our goal if management, your management of the Financial Institution, is to diminish the chances of that happening. You never condone bad