- Thomson Reuters
Wells Fargo’s board of directors is leaning toward clawing back stock-based compensation from Wells Fargo CEO John Stumpf and Carrie Tolstedt, the firm’s former head of community banking, according to The Wall Street Journal’s Emily Glazer.
Glazer, citing sources familiar with the matter, said the board was planning to have a decision regarding Stumpf’s compensation by Thursday, when the CEO is set to testify in front of the House Financial Services Committee.
It was unclear how much of Stumpf’s or Tolstedt’s compensation would be clawed back, but The Journal estimated that Stumpf’s total compensation while at Wells had been about $160 million.
The nearly $90 million in stock-based compensation given to Tolstedt while she oversaw the division that created 2 million credit- and debit-card accounts for customers without their knowledge had come under fire recently, especially during Stumpf’s testimony before the Senate Banking Committee.
Senators repeatedly asked Stumpf whether the bank would take back some of Tolstedt’s stock options, and he replied that he was not a member of the board of directors committee overseeing that decision. Additionally, a few senators – most notably Wall Street critic Elizabeth Warren – said Stumpf should give back some of his own pay.
The scandal has erupted over the past few weeks since Wells agreed to pay $185 million in fines to the Consumer Financial Protection Bureau, the Office of the Comptroller of the Currency, and the Los Angeles prosecutor’s office for the creation of accounts without customers’ knowledge. This drew attention to Tolstedt’s retirement, which was announced in July, since she was in charge of the division in which the retail banking misdeeds occurred.
A Wells Fargo representative declined to comment.