Wells Fargo named Charles Scharf its third CEO in as many years as the bank attempts to put behind it a series of recent scandals. Scharf will join the bank next month.
after what many considered a poor performance defending the bank in front of Congress in March.
In June, Wells Fargo & Co. announced that it agreed to pay at least $385 million to settle a California lawsuit alleging it signed up thousands of auto loan customers for costly car insurance without their consent, resulting in many having their vehicles repossessed. The 2017 class-action lawsuit alleged that for more than a decade, Wells Fargo tacked on insurance to customers’ car loans that they didn’t need because they had private insurance.
Federal regulators who lost patience with Wells Fargo’s continued bad behavior inflicted harsh punishments. Wells had to pay a $1-billion fine last year to the Consumer Financial Protection Bureau and the Office of the Comptroller of the Currency. But more importantly, the Federal Reserve stepped in and handcuffed Wells’ ability to grow its business until the bank could prove that it had gotten its house in order.
Wall Street, yearning for stability at a bank with annual revenue close to $65 billion, sent shares of Wells Fargo up almost 3% before the opening bell.
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