Former Wells Fargo CEO fined $17.5 million for sales scandal

Federal regulators have slapped former Wells Fargo CEO John Stumpf with a $17.5 million fine for his role in the bank’s sales practices scandal. Stumpf also accepted a lifetime ban from the banking industry.

Along with its fine against Stumpf, the Office of the Comptroller of the Currency announced Thursday it is suing five other former Wells Fargo executives for a combined total of $37.5 million for their roles in the bank’s poor practices. Two other executives also settled with regulators, paying million-dollar fines as well.

This is the first time regulators have punitively punished individual executives for Wells Fargo’s wrongdoing. The San Francisco-based bank has paid hundreds of millions of dollars in fines and penalties for encouraging employees to open up millions of fake accounts in order to meet unrealistic sales goals. Executives like Stumpf did give up tens of millions of dollars in bonuses and pay, but those actions were taken by Wells Fargo itself.

In its investigation, regulators laid the blame of Wells Fargo’s failures directly at the feet of its former management in its suit against the executives. As part of their settlements and lawsuits against these Wells’ executives, regulators seek to ban all of them from ever working in the banking industry again.

“The root cause of the sales practices misconduct problem was the Community Bank’s business model, which imposed intentionally unreasonable sales goals and unreasonable pressure on its employees to meet those goals and fostered an atmosphere that perpetuated improper and illegal conduct,” the OCC said in its complaint.

“Community Bank management intimidated and badgered employees to meet unattainable sales goals year after year, including by monitoring employees daily or hourly and reporting their sales performance to their...