$17 million fine assessed against former head of Well Fargo’s community bank for role in sales practices misconduct

A $17 million civil money penalty (CMP) was assessed Wednesday against the former head of Well Fargo Bank’s community bank for her alleged role in systemic sales practices misconduct, the regulator of national banks said.

The Office of the Comptroller of the Currency (OCC) said the CMP against Carrie Tolstedt, former head of Wells Fargo Bank, N.A.’s Community Bank, resolves an administrative enforcement action taken against her more than three years ago in January 2020. Then, the OCC filed a notice of charges against her.

That notice alleged, the OCC said, that the bank’s business model imposed “unreasonable sales goals on its employees, along with unreasonable pressure to meet such goals.”

“It is the OCC’s expectation that all employees of national banks and federal savings associations, including senior executives, treat customers fairly, comply with the law, and promote safe and sound banking practices,” the agency said in its release.

The agency also indicated that the $17 million CMP against Tolstedt has been paid, and was sent directly to the U.S. Treasury.

The penalty assessed against Tolstedt, the agency said, was in addition to settlements announced previously with seven other former Wells Fargo Bank senior executives. Those were:

  • Claudia Russ Anderson, Community Bank Group Risk Officer, Prohibition Order and $5 million CMP (Jan. 23, 2020);
  • James Strother, General Counsel, Personal Cease & Desist (PC&D) Order and $5 million CMP (Jan. 23, 2020) (Strother was also assessed at $3.5 CMP on Jan. 15, 2021);
  • David Julian, Chief Auditor, PC&D Order and $2 million CMP (Jan. 23, 2020);
  • Paul McLinko, Executive Audit Director, PC&D Order and $500,000 CMP (Jan. 23, 2020);
  • Matthew Raphaelson, former Community Bank Group Finance Officer, Prohibition Order and $925,000 CMP (Sept. 21, 2020);
  • Kenneth Zimmerman, former Head of Community Bank Deposit Products Group, PC&D and $400,000 CMP (Sept. 21, 2020);
  • Tracy Kidd, former Head of Community Bank Human Resources, PC&D and $350,000 CMP (Sept. 21, 2020);

OCC Issues Prohibition Order, Fines Former Wells Fargo Executive $17 Million in Settlement