Wells Fargo share price down 1% as Congress questions CEO
The bank's stock falls as its CEO testifies before the US Congress.
Wells Fargo share price is down before the US Congress scrtinises the financial institution’s practices. Tim Sloan, chief executive officer (CEO), is slated to testify before the US Congress.
Why is Wells Fargo share price falling before Congressional hearings?
Wells Fargo stock is likely plummeting because of the negative news about Wells Fargo. Sloan is appearing before the House Financial Services Committee to answer for a series of scandals that have dogged the corporation. He is answering questions about defrauding customers for years. The bank created 3.5 million fake accounts in 190,000 clients’ names and charged them exorbitant fees. Wells Fargo recently agreed to reimburse the customers for $575 million.
In the wake of the scandal, Democratic politicians like House Financial Services Chair, Maxine Waters, have openly criticised the CEO. US Senator, Elizabeth Warren, even called for Sloan to be fired after the news broke about the bank's deceptive practices. At his appearance before Congress, Sloan will promise that Wells Fargo won’t engage in fraudulent behavior anymore.
‘We have discarded our old decentralized structure that allowed prior problems to occur,’ wrote Sloan in remarks he will deliver before Congress.
Sloan also vowed that Wells Fargo would work to earn the trust of its customers.
‘While we have more work to do, we've worked hard over the past two years to address the root causes of our mistakes, make things right for team members and customers, and lay the foundation for a better company,’ said Sloan.
Has Wells Fargo changed after financial scandals?
Wells Fargo has claimed that it is working to better serve customers. However, a recent two-day outage that kept customers from obtaining funds is creating more customer service issues for the bank. Cowen analyst, Janet Seiberg, notes that Sloan has to convince Waters that the bank has changed its ways to improve customer relations.
‘If Sloan can appease Waters at the hearing, then it would represent a major step for the bank in getting past these troubles,’ said Seiberg.
The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer.
Act on share opportunities today
Go long or short on thousands of international stocks with CFDs.
- Get full exposure for a comparatively small deposit
- Trade on spreads from just 0.1%
- Get greater order book visibility with direct market access
See opportunity on a stock?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Take your position
- See whether your hunch pays off
See opportunity on a stock?
Don’t miss your chance – upgrade to a live account to take advantage.
- Trade a huge range of popular stocks
- Analyse and deal seamlessly on fast, intuitive charts
- See and react to breaking news in-platform
See opportunity on a stock?
Don’t miss your chance. Log in to take your position.
Live prices on most popular markets
- Forex
- Shares
- Indices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
