After a scandal was exposed last summer that showed Wells Fargo creating false accounts to boost profits, the bank has been in the hot seat. Despite a strong year of stock performance, the bank still has several appearances to make before the U.S. Senate which have the potential to play with the stock’s performance. Reuters reports:
Wells Fargo & Co (WFC.N) CEO Tim Sloan will be questioned about sales practices, mischarging customers for auto insurance, and complaints about mortgage fees at the bank’s consumer lending unit when he testifies before U.S. senators on Tuesday.
This most recent interrogation can have dramatic consequences, as Reuters also reports:
…on Monday that the Office of the Comptroller of the Currency, the leading regulator for Wells Fargo, was considering new sanctions against the bank for customer abuses involving auto insurance and mortgage loans.
CEO Tim Sloan is therefore under major pressure to prove that his bank has overhauled their practices and has appropriately responded to regulators’ previous sanctions. Should the bank be faced with a renewed attack from the Senate, it could cause more negative media which in turn may shock the stock into a downward turn.
Investors and clients of Wells Fargo should stay tuned for Sloan’s testimony today so they are aware of what the bank is doing to continue compensating their clients and to solidify investor confidence going forward. Government audits and investigations are never a recipe for success so be sure to adapt to any changing circumstances.
For Reuter’s article on Tim Sloan’s upcoming visit to the Senate, click here.
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