Former Denver mayor Federico Peña is taking heat for failing to catch and stop practices that resulted in the creation of 2 million bogus accounts at Wells Fargo & Co., where he is a director.
Banking industry analyst Michael Mayo on Monday called for Peña to step down as head of the bank holding company’s Corporate Responsibility Committee, which is tasked with monitoring “the company’s reputation generally, including with its customers.”
“To hold management accountable, we believe Wells should institute clawbacks for the head of Community Banking (Carrie Tolstedt), clawbacks and/or pay reduction for the CEO (John Stumpf), changes to its board for the head of the Corporate Responsibility Committee (Federico Peña), and questions or at least a statement from its lead director (Stephen Sanger),” Mayo, an analyst with CLSA, told Barrons.
Without admitting or denying guilt, Wells Fargo, which is the largest bank operating in Colorado, agreed to pay $185 million in fines to settle the case with federal regulators. It fired about 5,300 mostly low-level employees who set up the unauthorized accounts.
But critics want to see heads higher up roll, given employees were responding to intense pressures to cross-sell products and meet goals.