An additional $75 million in executive pay has been clawed back from two past executives as part of the ongoing fallout from investigations into sales practices at Wells Fargo.
The action comes in the wake of a 113-page report released Monday (April 10) tied to a committee appointed by the company’s board. In addition, reported The Wall Street Journal, the monies taken back from CEO John Stumpf and the head of retail banking, Carrie Tolstedt, are more than was previously reported. Why the additional penalties? Said the WSJ, the board “felt misled” about “the extent of sales abuses” that stretched back roughly a decade-and-a-half to 2002.
The investigation had significant fallout, at $185 million in fines tied to several inquiries. The board had not been informed about the firings of 5,300 employees in the wake of the sales practice scandal until that action had been tackled in the fall of last year.
Of the $75 million, $28 million is being taken back from Stumpf that had been paid out in 2016 via equity grant that had been made in 2013. That comes on top of $41 million in clawbacks.
As for Tolstedt, clawbacks are via stock options at $47 million in a recent valuation, added to $19 million in clawbacks directed earlier. All in, noted the WSJ, returned money has come in at $183 million, which come to a record.
The report issued by the board found that the firm’s own movement to address alleged fake account openings was “insufficient.” The information conveyed to the board, along with the “insular and defensive” nature of some executives at Tolstedt’s operations “minimized and understated problems.”
Source: http://www.pymnts.com – Payments
M In Additional Clawbacks From Wells Fargo Execs on Sales Practices