Wells Fargo CEO's overtures earn bipartisan rebuke in fiery congressional hearing

Wells Fargo CEO Timothy Sloan is questioned by the House Financial Services Committee about revelations the bank had created millions of fake bank accounts to reach their financial goals on Capitol Hill in Washington Tuesday

Wells Fargo CEO Tim Sloan on Tuesday pledged to Congress that the lender's laundry list of scandals are being addressed, but the overtures fell flat among lawmakers who blasted the slow pace of the recovery and questioned whether the bank is too large to change.

Timothy Sloan testified in the House Financial Services Committee Hearing meant to hold "megabanks" accountable.

At the hearing, Porter asked Sloan whom Congress should believe: Sloan when he says he's fixed things, or his lawyers who say he's just resorting to puffery.

Several lawmakers noted that Wells had been fined by every agency it is regulated by and Sloan said that by his count, the bank is now under 14 consent decrees with those agencies.

"We continue to be disappointed with Wells Fargo Bank N.A.'s performance under our consent orders and its inability to execute effective corporate governance and a successful risk management program", a spokesperson for the Office of the Comptroller of the Currency told CBS MoneyWatch by email.

"Why was the bank involved in the caging of children and financing the caging of children to begin with?" Within risk, the company has three "lines of defense" - front-line risk, independent risk management, and audit - to ensure multiple layers of review and to improve internal oversight.

Republicans have also criticized Wells Fargo and on Tuesday said they would also be pressing Sloan for proof the fourth-largest US bank has addressed customer abuses.

"For a period of time, we were involved in financing one of the firms, we are not anymore", Sloan said.

He said one exit was finalized and the other was still pending, but he couldn't remember which was which.

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On Tuesday, Rep. Katie Porter (D-Calif.) flagged these quotes from filings in an ongoing class-action lawsuit against Wells Fargo that alleges the company hurt shareholders by hiding its auto repossession scandal from the public in the months after the fake-account scandal. Wells Fargo has shaken up its executive ranks, raised the minimum wage to $15 an hour and given millions to charity, he told them. The scandal led to the retirement of CEO John Stumpf, who was replaced by Sloan, a company insider. Sloan promised that he has made "fundamental changes" at the bank and its problems have been "fixed".

"Regulators hit Wells Fargo with a $1-billion fine a year ago for forcing auto-loan customers into unneeded insurance policies and charging improper fees to some mortgage borrowers", The Times reports.

The committee's ranking Republican, Patrick McHenry of North Carolina, said his party wouldn't show any sympathy for Wells Fargo.

Waters, a noted critic of Wall Street, also said the bank's "ongoing lawlessness" and its failure to reform suggests it is "too big to manage".

Last year, the bank paid $1 billion to federal regulators to settle allegations it mistreated consumers.

Other scandals engulfing the biggest USA mortgage lender have included selling auto insurance and other financial products to customers who didn't need them; charging service members higher rates on loans than allowed by law; and improperly selling complex financial products to retail investors.

Sloan said since assuming the role of chief executive, he's implemented a culture where the customer comes first.

The shares were up 0.2 percent in early afternoon trading Monday, a fraction of the gains at other big banks including JPMorgan Chase & Co., Bank of America Corp. and Citigroup Inc.

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