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Wells Fargo & Company is an American multinational financial services company with corporate
headquarters Headquarters (commonly referred to as HQ) denotes the location where most, if not all, of the important functions of an organization are coordinated. In the United States, the corporate headquarters represents the entity at the center or the to ...
in San Francisco, California; operational headquarters in Manhattan; and managerial offices throughout the United States and internationally. The company has operations in 35 countries with over 70 million customers globally. It is considered a
systemically important financial institution A systemically important financial institution (SIFI) is a bank, insurance company, or other financial institution whose failure might trigger a financial crisis. They are colloquially referred to as "too big to fail". As the financial crisis o ...
by the Financial Stability Board. The firm's primary subsidiary is Wells Fargo Bank, N.A., a national bank which designates its Sioux Falls, South Dakota site as its main office. It is the fourth largest bank in the United States by total assets and is also one of the largest as ranked by bank deposits and
market capitalization Market capitalization, sometimes referred to as market cap, is the total value of a publicly traded company's outstanding common shares owned by stockholders. Market capitalization is equal to the market price per common share multiplied by t ...
. Along with JPMorgan Chase, Bank of America and Citigroup. Wells Fargo is one of the "
Big Four Banks The Big Four (or Big 4) is the colloquial name given to the four main banks in several countries where the banking industry is dominated by just four institutions and where the phrase has thus gained relevance. Some countries include more or less i ...
" of the United States. It has 8,050 branches and 13,000 ATMs. It is one of the most valuable bank brands. Wells Fargo, in its present form, is a result of a merger between the original Wells Fargo & Company and Minneapolis-based Norwest Corporation in 1998. While Norwest was the nominal survivor, the merged company took the better-known Wells Fargo name and moved to Wells Fargo's hub in San Francisco. At the same time, its banking subsidiary merged with Wells Fargo's Sioux Falls-based banking subsidiary. Wells Fargo became a coast-to-coast bank with the 2008 acquisition of Charlotte-based Wachovia. Wells Fargo is ranked 41st on the
Fortune 500 The ''Fortune'' 500 is an annual list compiled and published by ''Fortune'' magazine that ranks 500 of the largest United States corporations by total revenue for their respective fiscal years. The list includes publicly held companies, along ...
list of the largest companies in the US. The company has been the subject of several investigations by regulators. On February 2, 2018, account fraud by the bank resulted in the Federal Reserve barring Wells Fargo from growing its nearly $2 trillion-asset base any further until the company fixed its internal problems to the satisfaction of the Federal Reserve. In September 2021, Wells Fargo incurred further fines from the
United States Justice Department The United States Department of Justice (DOJ), also known as the Justice Department, is a United States federal executive departments, federal executive department of the United States government tasked with the enforcement of federal law and a ...
charging fraudulent behavior by the bank against foreign-exchange currency trading customers. '' Bloomberg Businessweek'' reported in March 2022 that Wells Fargo was the only major lender in 2020 to reject more home refinancing applications from Black applicants than it approved.


History

Henry Wells and
William G. Fargo William George Fargo (May 20, 1818August 3, 1881) was a pioneer American expressman who helped found the modern-day financial firms of American Express Company and Wells Fargo with his business partner, Henry Wells. He was also the 27th Mayor o ...
, who founded
American Express American Express Company (Amex) is an American multinational corporation specialized in payment card services headquartered at 200 Vesey Street in the Battery Park City neighborhood of Lower Manhattan in New York City. The company was found ...
along with John Butterfield, formed Wells Fargo & Company in 1852 to provide "express" and banking services to California, which was growing rapidly due to the
California Gold Rush The California Gold Rush (1848–1855) was a gold rush that began on January 24, 1848, when gold was found by James W. Marshall at Sutter's Mill in Coloma, California. The news of gold brought approximately 300,000 people to California fro ...
. Its earliest and most significant tasks included transporting gold from the Philadelphia Mint and "express" mail delivery that was faster and less expensive than U.S. Mail. American Express was not interested in serving California. By the end of the
California Gold Rush The California Gold Rush (1848–1855) was a gold rush that began on January 24, 1848, when gold was found by James W. Marshall at Sutter's Mill in Coloma, California. The news of gold brought approximately 300,000 people to California fro ...
, Wells Fargo was a dominant express and banking organization in the West, making large shipments of gold and delivering mail and supplies. It was also the primary lender of Butterfield Overland Mail Company, which ran a 2,757 mile route through the Southwest to San Francisco and was nicknamed the "Butterfield Line" after the name of company's president John Butterfield. In 1860, Congress failed to pass the annual Post Office
appropriation bill An appropriation, also known as supply bill or spending bill, is a proposed law that authorizes the expenditure of government funds. It is a bill that sets money aside for specific spending. In some democracies, approval of the legislature is ne ...
leaving the Post Office unable to pay Overland Mail Company. This caused Overland to default on its debts to Wells Fargo, allowing Wells Fargo to take control of the mail route. Wells Fargo then operated the western portion of the Pony Express. Six years later, the "Grand Consolidation" united Wells Fargo, Holladay, and Overland Mail stage lines under the Wells Fargo name. In 1872, Lloyd Tevis, a friend of the Central Pacific "Big Four" and holder of rights to operate an express service over the Transcontinental Railroad, became president of the company after acquiring a large stake, a position he held until 1892. In 1905, Wells Fargo separated its banking and express operations, and Wells Fargo's bank merged with the Nevada National Bank to form the
Wells Fargo Nevada National Bank Wells most commonly refers to: * Wells, Somerset, a cathedral city in Somerset, England * Well, an excavation or structure created in the ground * Wells (name) Wells may also refer to: Places Canada *Wells, British Columbia England * Wells ...
. During the First World War, the United States government nationalized Wells Fargo's express business into a federal agency known as the US Railway Express Agency (REA). After the war, the REA was privatized and continued service until 1975. In 1923, Wells Fargo Nevada merged with the Union Trust Company to form the Wells Fargo Bank & Union Trust Company. In 1954, Wells Fargo & Union Trust shortened its name to Wells Fargo Bank. Four years later, it merged with American Trust Company to form the Wells Fargo Bank American Trust Company. It changed its name back to Wells Fargo Bank in 1962. In 1968, Wells Fargo was converted to a federal banking charter and became
Wells Fargo Bank, N.A. Wells Fargo & Company is an American multinational financial services company with corporate headquarters in San Francisco, California; operational headquarters in Manhattan; and managerial offices throughout the United States and inter ...
In that same year, Wells Fargo merged with Henry Trione's Sonoma Mortgage in a $10.8 million stock transfer, making Trione the largest shareholder in Wells Fargo until Warren Buffett and
Walter Annenberg Walter Hubert Annenberg (March 13, 1908 – October 1, 2002) was an American businessman, investor, philanthropist, and diplomat. Annenberg owned and operated Triangle Publications, which included ownership of ''The Philadelphia Inquirer'' ...
surpassed him. One year later, Wells Fargo & Company holding company was formed, with Wells Fargo Bank as its main subsidiary. In September 1983, a Wells Fargo armored truck depot in West Hartford, Connecticut was the victim of the
White Eagle White Eagle(s) may refer to: History and politics * Coat of arms of Poland, a white eagle * Crusade of Romanianism, or White Eagles, a 1930s far-right movement in Romania * Task Force White Eagle, a Polish military unit during the War in Afghanist ...
robbery, involving an insider who worked as an armored truck guard, in the largest US bank theft to date, with $7.1 million stolen and two co-workers tied up. The robbery was carried out with the support of the government of Cuba and the cash was initially moved to Mexico City. Throughout the 1980s and 90s, Wells Fargo completed a series of acquisitions. In 1986, it acquired Crocker National Bank from Midland Bank. Then, in 1987 it acquired the personal trust business of Bank of America. In 1988, it acquired Barclays Bank of California from Barclays plc. In 1991, Wells Fargo spent $491 million to acquire 130 branches in California from
Great American Bank Great American Bank was an American savings and loan association based in San Diego. It was founded in 1885 as San Diego Building and Loan Association, the first S&L in Southern California. Until the 1980s, it operated for decades as San Diego Fe ...
. In 1996, Wells Fargo acquired First Interstate Bancorp for $11.6 billion. Integration went poorly as many executives left. Wells Fargo became the first major US financial services firm to offer Internet banking, in May 1995. After its string of acquisitions, in 1998, Wells Fargo Bank was acquired by Norwest Corporation of Minneapolis, with the combined company assuming the Wells Fargo name. It then began on another set of acquisitions, starting in 2000, when Wells Fargo Bank acquired
National Bank of Alaska National Bank of Alaska (originally known as Bank of Alaska) was Alaska's largest financial institution for the latter part of the 20th century. In 2000, it was purchased by Wells Fargo, giving the larger bank a presence in 23 states. Founding an ...
and First Security Corporation. In late 2001, it acquired
H.D. Vest Financial Services HD Vest, Inc. is an American financial services firm, which offers tax and other financial planning consultations to its customers. Founded in 1983 as "HD Vest Investment Securities, Inc.", the company now operates under the name "HD Vest Financia ...
for $128 million, but sold it in 2015 for $580 million. In 2007, Wells Fargo acquired Greater Bay Bancorp, which had $7.4 billion in assets, in a $1.5 billion transaction. It also acquired Placer Sierra Bank and CIT Group's construction unit that same year. In 2008, Wells Fargo acquired United Bancorporation of Wyoming and Century Bancshares of Texas. On October 3, 2008, after Wachovia turned down an inferior offer from Citigroup, Wachovia agreed to be bought by Wells Fargo for about $14.8 billion in stock. The next day, a New York state judge issued a temporary injunction blocking the transaction from going forward while the competing offer from Citigroup was sorted out. Citigroup alleged that it had an exclusivity agreement with Wachovia that barred Wachovia from negotiating with other potential buyers. The injunction was overturned late in the evening on October 5, 2008, by New York state appeals court. Citigroup and Wells Fargo then entered into negotiations brokered by the FDIC to reach an amicable solution to the impasse. The negotiations failed. Citigroup was unwilling to take on more risk than the $42 billion that would have been the cap under the previous FDIC-backed deal (with the FDIC incurring all losses over $42 billion). Citigroup did not block the merger, but sought damages of $60 billion for breach of an alleged exclusivity agreement with Wachovia. On October 28, 2008, Wells Fargo received $25 billion of funds via the
Emergency Economic Stabilization Act The Emergency Economic Stabilization Act of 2008, often called the "bank bailout of 2008", was proposed by Treasury Secretary Henry Paulson, passed by the 110th United States Congress, and signed into law by President George W. Bush. It beca ...
in the form of a preferred stock purchase by the United States Department of the Treasury. As a result of requirements of the government stress tests, the company raised $8.6 billion in capital in May 2009. On December 23, 2009, Wells Fargo redeemed $25 billion of preferred stock issued to the United States Department of the Treasury. As part of the redemption of the preferred stock, Wells Fargo also paid accrued dividends of $131.9 million, bringing the total dividends paid to $1.441 billion since the preferred stock was issued in October 2008. In April 2009, Wells Fargo acquired North Coast Surety Insurance Services. In 2011, the company hired 25 investment bankers from Citadel LLC. In April 2012, Wells Fargo acquired Merlin Securities. In December 2012, it was rebranded as Wells Fargo Prime Services. In December of that year, Wells Fargo acquired a 35% stake in The Rock Creek Group LP. The stake was increased to 65% in 2014 but sold back to management in July 2018. In 2015, Wells Fargo Rail acquired GE Capital Rail Services and merged in with First Union Rail. In late 2015, Wells Fargo acquired three GE units focused on business loans equipment financing. In March 2017, Wells Fargo announced a plan to offer smartphone-based transactions with mobile wallets including Wells Fargo Wallet, Android Pay and Samsung Pay. In June 2018, Wells Fargo sold all 52 of its physical bank branch locations in Indiana, Michigan, and Ohio to
Flagstar Bank Flagstar Bank is a Michigan-based bank that has one of the largest residential mortgage servicers in the United States, as well as included in a list of the largest banks in the country. On April 26, 2021, New York Community Bancorp, Inc. (NYCB) ...
. In September 2018, Wells Fargo announced it would cut 26,450 jobs by 2020 to reduce costs by $4 billion. In March 2019, CEO Tim Sloan resigned amidst the Wells Fargo account fraud scandal and former general counsel
C. Allen Parker C. Allen Parker (born February 17, 1955) is an American business executive and attorney. He was the senior executive vice president and general counsel of Wells Fargo, and also served as its interim CEO and president. Prior to joining Wells Far ...
became interim CEO. In July 2019,
Principal Financial Group Principal Financial Group is an American global financial investment management and insurance company headquartered in Des Moines, Iowa, U.S. Business operations Four segments comprise the company: Retirement and Income Solutions, Principal G ...
acquired the company's Institutional Retirement & Trust business. On September 27, 2019, Charles Scharf was announced as the firm's new CEO. In 2020, the company sold its student loan portfolio. In May 2021, the company sold its Canadian Direct Equipment Finance business to Toronto-Dominion Bank. In 2021, the company sold its asset management division, Wells Fargo Asset Management (WFAM) to private equity firms
GTCR GTCR LLC is a Chicago, Illinois-based private equity firm focused on leveraged buyout, leveraged recapitalization, growth capital and rollup transactions. The firm principally invests in high-growth industries, including financial services & tec ...
and Reverence Capital Partners for $2.1 billion. WFAM had $603 billion in assets under management as of December 31, 2020, of which 33% was invested in money market funds. WFAM was rebranded as Allspring Global Investments.


Environmental record

In 2009, Wells Fargo ranked 1st among banks and insurance companies, and 13th overall, in Newsweek Magazine's inaugural "Green Rankings" of the country's 500 largest companies. In 2013, the company was recognized by the EPA Center for Corporate Climate Leadership as a Climate Leadership Award winner, in the category "Excellence in Greenhouse Gas Management (Goal Setting Certificate)"; this recognition was for the company's aim to reduce its absolute greenhouse gas emissions from its US operations by 35% by 2020 versus 2008 levels. In 2017, Wells Fargo ranked 182nd out of 500 in Newsweek Magazine's "Green Rankings" of the largest US companies; Wells Fargo has provided more than $10 billion in financing for environmentally beneficial business opportunities, including supporting commercial-scale solar
photovoltaic Photovoltaics (PV) is the conversion of light into electricity using semiconducting materials that exhibit the photovoltaic effect, a phenomenon studied in physics, photochemistry, and electrochemistry. The photovoltaic effect is commercially us ...
projects and utility-scale wind projects nationwide. In 2010, Wells Fargo launched what it believes to be the first blog in its industry to report on its environmental stewardship and to solicit feedback and ideas from its stakeholders.


Wells Fargo History Museum

The company operates the Wells Fargo History Museum at 420 Montgomery Street, San Francisco. Displays include original
stagecoach A stagecoach is a four-wheeled public transport coach used to carry paying passengers and light packages on journeys long enough to need a change of horses. It is strongly sprung and generally drawn by four horses although some versions are draw ...
es, photographs, gold nuggets and mining artifacts, the Pony Express, telegraph equipment, and historic bank artifacts. The museum also has a gift shop. In January 2015, armed robbers in an SUV smashed through the museum's glass doors and stole gold nuggets. The company previously operated other museums but those have since closed.


Operations and services


Consumer Banking and Lending

The Consumer Banking and Lending segment includes Regional Banking, Diversified Products, and Consumer Deposits groups, as well as Wells Fargo Customer Connection (formerly Wells Fargo Phone Bank, Wachovia Direct Access, the National Business Banking Center, and Credit Card Customer Service). Wells Fargo also has around 2,000 stand-alone mortgage branches throughout the country. There are also mini-branches located inside of other buildings, which are almost exclusively grocery stores, that usually contain ATMs, basic bank teller services, and an office for private meetings with customers.


Consumer lending

Wells Fargo Home Mortgage is the second largest retail mortgage originator in the United States, originating one out of every four home loans. Wells Fargo services $1.8 trillion in home mortgages, the one of the largest servicing portfolios in the US.


Equipment lending

Wells Fargo has various divisions, including Wells Fargo Rail, that finance and lease equipment to different types of companies.


Wealth and Investment Management

Wells Fargo offers investment products through its subsidiaries, Wells Fargo Investments, LLC, and Wells Fargo Advisors, LLC, as well as through national broker/dealer firms. The company also serves high-net-worth individuals through its private bank and family wealth group.
Wells Fargo Advisors Wells Fargo Advisors is a subsidiary of Wells Fargo, located in St Louis, Missouri. It is the third largest brokerage firm in the United States as of June 30, 2021 with $1.9 trillion retail client assets under management. The subsidiary was for ...
is the brokerage subsidiary of Wells Fargo, located in St. Louis, Missouri. It is the third-largest brokerage firm in the United States as of the third quarter of 2010 with $1.1 trillion retail client assets under management. Wells Fargo Advisors was known as Wachovia Securities until May 1, 2009, when it was renamed following Wells Fargo's acquisition of Wachovia Corporation.


Securities

Wells Fargo Securities (WFS) is the
investment banking Investment banking pertains to certain activities of a financial services company or a corporate division that consist in advisory-based financial transactions on behalf of individuals, corporations, and governments. Traditionally associated wit ...
division of Wells Fargo & Co. headquartered in Charlotte, with other U.S. offices in New York, Minneapolis, Boston, Houston, San Francisco, and Los Angeles and with international offices in London, Hong Kong, Singapore, and Tokyo. Wells Fargo Securities was established in 2009 after the acquisition of Wachovia Securities. It provides sales and trading,
fixed income Fixed income refers to any type of investment under which the borrower or issuer is obliged to make payments of a fixed amount on a fixed schedule. For example, the borrower may have to pay interest at a fixed rate once a year and repay the prin ...
, FX and rates,
equity Equity may refer to: Finance, accounting and ownership * Equity (finance), ownership of assets that have liabilities attached to them ** Stock, equity based on original contributions of cash or other value to a business ** Home equity, the dif ...
, merger and acquisition,
high yield In finance, a high-yield bond (non-investment-grade bond, speculative-grade bond, or junk bond) is a bond that is rated below investment grade by credit rating agencies. These bonds have a higher risk of default or other adverse credit events, ...
, leveraged finance, equity underwriting,
private placement Private placement (or non-public offering) is a funding round of securities which are sold not through a public offering, but rather through a private offering, mostly to a small number of chosen investors. Generally, these investors include friend ...
,
loan syndication A syndicated loan is one that is provided by a group of lenders and is structured, arranged, and administered by one or several commercial banks or investment banks known as lead arrangers. The syndicated loan market is the dominant way for larg ...
, risk management, and public finance services


Cross-selling

A key part of Wells Fargo's business strategy is cross-selling, the practice of encouraging existing customers to buy additional banking services. Customers inquiring about their checking account balance may be pitched mortgage deals and mortgage holders may be pitched credit card offers in an attempt to increase the customer's profitability to the bank. Other banks have attempted to emulate Wells Fargo's cross-selling practices (described by '' The Wall Street Journal'' as a hard sell technique).


International operations

Wells Fargo has banking services throughout the world, with overseas offices in Hong Kong, London, Dubai, Singapore, Tokyo, and Toronto. Back-offices are in India and the Philippines with more than 20,000 staff. In 2010, hedge fund administrator Citco purchased the trust company operation of Wells Fargo in the
Cayman Islands The Cayman Islands () is a self-governing British Overseas Territory—the largest by population in the western Caribbean Sea. The territory comprises the three islands of Grand Cayman, Cayman Brac and Little Cayman, which are located to the ...
.


Charter

Wells Fargo operates under Charter #1, the first national bank
charter A charter is the grant of authority or rights, stating that the granter formally recognizes the prerogative of the recipient to exercise the rights specified. It is implicit that the granter retains superiority (or sovereignty), and that the rec ...
issued in the United States. This charter was issued to First National Bank of Philadelphia on June 20, 1863, by the Office of the Comptroller of the Currency. Traditionally, acquiring banks assume the earliest issued charter number. Thus, the first charter passed from First National Bank of Philadelphia to Wells Fargo through its 2008 acquisition of Wachovia, which had inherited it through one of its many acquisitions.


Lawsuits, fines and controversies


1981 MAPS Wells Fargo embezzlement scandal

In 1981, it was discovered that a Wells Fargo assistant operations officer, Lloyd Benjamin "Ben" Lewis, had perpetrated one of the largest embezzlements in history, through its Beverly Drive branch. During 1978 - 1981, Lewis had successfully written phony debit and credit receipts to benefit
boxing promoter A promoter works with event production and entertainment industries to promote their productions, including in music and sports. Promoters are individuals or organizations engaged in the business of marketing and promoting live, or pay-per-view ...
s Harold J. Smith (
A birth name is the name of a person given upon birth. The term may be applied to the surname, the given name, or the entire name. Where births are required to be officially registered, the entire name entered onto a birth certificate or birth reg ...
Ross Eugene Fields) and Sam "Sammie" Marshall, chairman and president, respectively, of Muhammed Ali Professional Sports, Inc. (MAPS), of which Lewis was also listed as a director; Marshall, too, was a former employee of the same Wells Fargo branch as Lewis. In excess of $300,000 was paid to Lewis, who pled guilty to
embezzlement Embezzlement is a crime that consists of withholding assets for the purpose of conversion of such assets, by one or more persons to whom the assets were entrusted, either to be held or to be used for specific purposes. Embezzlement is a type ...
and conspiracy charges in 1981, and testified against his co-conspirators for a reduced five-year sentence. (Boxer
Muhammed Ali Muhammad Ali (; born Cassius Marcellus Clay Jr.; January 17, 1942 – June 3, 2016) was an American professional boxer and activist. Nicknamed "The Greatest", he is regarded as one of the most significant sports figures of the 20th century, a ...
had received a fee for the use of his name, and had no other involvement with the organization.)


Higher costs charged to African-American and Hispanic borrowers

Illinois Attorney General Lisa Madigan filed suit against Wells Fargo on July 31, 2009, alleging that the bank steers African Americans and
Hispanics The term ''Hispanic'' ( es, hispano) refers to people, cultures, or countries related to Spain, the Spanish language, or Hispanidad. The term commonly applies to countries with a cultural and historical link to Spain and to viceroyalties former ...
into high-cost
subprime In finance, subprime lending (also referred to as near-prime, subpar, non-prime, and second-chance lending) is the provision of loans to people in the United States who may have difficulty maintaining the repayment schedule. Historically, subpri ...
loans. A Wells Fargo spokesman responded that "The policies, systems, and controls we have in place – including in Illinois – ensure race is not a factor..." An affidavit filed in the case stated that loan officers had referred to black mortgage-seekers as "mud people," and the subprime loans as "ghetto loans." According to Beth Jacobson, a loan officer at Wells Fargo interviewed for a report in '' The New York Times'', "We just went right after them. Wells Fargo mortgage had an emerging-markets unit that specifically targeted black churches because it figured church leaders had a lot of influence and could convince congregants to take out subprime loans." The report presented data from the city of
Baltimore Baltimore ( , locally: or ) is the most populous city in the U.S. state of Maryland, fourth most populous city in the Mid-Atlantic, and the 30th most populous city in the United States with a population of 585,708 in 2020. Baltimore was d ...
, where more than half the properties subject to foreclosure on a Wells Fargo loan from 2005 to 2008 now stand vacant. And 71 percent of those are in predominantly black neighborhoods. Wells Fargo agreed to pay $125 million to subprime borrowers and $50 million in direct down payment assistance in certain areas, for a total of $175 million.


Failure to monitor suspected money laundering

In a March 2010 agreement with US federal prosecutors, Wells Fargo acknowledged that between 2004 and 2007 Wachovia had failed to monitor and report suspected money laundering by narcotics traffickers, including the cash used to buy four planes that shipped a total of 22 tons of cocaine into Mexico.


Overdraft fees

In August 2010, Wells Fargo was fined by United States district court judge William Alsup for overdraft practices designed to "gouge" consumers and "profiteer" at their expense, and for misleading consumers about how the bank processed transactions and assessed overdraft fees.


Settlement and fines regarding mortgage servicing practices

On February 9, 2012, it was announced that the five largest
mortgage servicers A mortgage servicer is a company to which some borrowers pay their mortgage loan payments and which performs other services in connection with mortgages and mortgage-backed securities. The mortgage servicer may be the entity that originated the mor ...
( Ally Financial, Bank of America,
Citigroup Citigroup Inc. or Citi (Style (visual arts), stylized as citi) is an American multinational investment banking, investment bank and financial services corporation headquartered in New York City. The company was formed by the merger of banking ...
, JPMorgan Chase, and Wells Fargo) agreed to a settlement with the US Federal Government and 49 states. The settlement, known as the National Mortgage Settlement (NMS), required the servicers to provide about $26 billion in relief to distressed homeowners and in direct payments to the federal and state governments. This settlement amount makes the NMS the second largest civil settlement in U.S. history, only trailing the Tobacco Master Settlement Agreement. The five banks were also required to comply with 305 new mortgage servicing standards.
Oklahoma Oklahoma (; Choctaw language, Choctaw: ; chr, ᎣᎧᎳᎰᎹ, ''Okalahoma'' ) is a U.S. state, state in the South Central United States, South Central region of the United States, bordered by Texas on the south and west, Kansas on the nor ...
held out and agreed to settle with the banks separately. On April 5, 2012, a federal judge ordered Wells Fargo to pay $3.1 million in punitive damages over a single loan, one of the largest fines for a bank ever for mortgaging service misconduct, after the bank improperly charged Michael Jones, a New Orleans homeowner, with $24,000 in mortgage fees, after the bank misallocated payments to interest instead of principal. Elizabeth Magner, a federal bankruptcy judge in the Eastern District of Louisiana, cited the bank's behavior as "highly reprehensible", stating that Wells Fargo has taken advantage of borrowers who rely on the bank's accurate calculations. The award was affirmed on appeal in 2013. In May 2013, New York attorney-general Eric Schneiderman announced a lawsuit against Wells Fargo over alleged violations of the national mortgage settlement. Schneidermann claimed Wells Fargo had violated rules over giving fair and timely serving. In 2015, a judge sided with Wells Fargo.


SEC fine due to inadequate risk disclosures

On August 14, 2012, Wells Fargo agreed to pay around $6.5 million to settle U.S. Securities and Exchange Commission (SEC) charges that in 2007 it sold risky mortgage-backed securities without fully realizing their dangers.


Lawsuit by FHA over loan underwriting

In 2016, Wells Fargo agreed to pay $1.2 billion to settle allegations that the company violated the False Claims Act by underwriting over 100,000 Federal Housing Administration (FHA) backed loans when over half of the applicants did not qualify for the program. In October 2012, Wells Fargo was sued by United States Attorney Preet Bharara over questionable mortgage deals.


Lawsuit due to premium inflation on forced place insurance

In April 2013, Wells Fargo settled a suit with 24,000 Florida homeowners alongside insurer QBE Insurance, in which Wells Fargo was accused of inflating premiums on forced-place insurance.


Lawsuit regarding excessive overdraft fees

In May 2013, Wells Fargo paid $203 million to settle class-action litigation accusing the bank of imposing excessive
overdraft An overdraft occurs when something is withdrawn in excess of what is in a current account. For financial systems, this can be funds in a bank account. For water resources, it can be groundwater in an aquifer. In these situations the account is s ...
fees on checking-account customers.


Violation of New York credit card laws

In February 2015, Wells Fargo agreed to pay $4 million, including a $2 million penalty and $2 million in restitution for illegally taking an interest in the homes of borrowers in exchange for opening credit card accounts for the homeowners.


Tax liability and lobbying

In December 2011, Public Campaign criticized Wells Fargo for spending $11 million on lobbying during 2008–2010, while increasing executive pay and laying off workers, while having no federal tax liability due to losses from the Great Recession. However, in 2013, the company paid $9.1 billion in income taxes.


Prison industry investment

The company has invested its clients' funds in GEO Group, a multi-national provider of for-profit private prisons. By March 2012, its stake had grown to more than 4.4 million shares worth $86.7 million. As of November 2012, Wells Fargo divested 33% of its holdings of GEO's stock, reducing its stake to 4.98% of Geo Group's common stock, below the threshold of which it must disclose further transactions.


Discrimination against African Americans in hiring

In August 2020, the company agreed to pay $7.8 million in back wages for allegedly discriminating against 34,193 African Americans in hiring for tellers, personal bankers, customer sales and service representatives, and administrative support positions. The company agreed to provide jobs to 580 of the affected applicants.


SEC settlement for insider trading case

In May 2015, Gregory T. Bolan Jr., a stock analyst at Wells Fargo agreed to pay $75,000 to the U.S. Securities and Exchange Commission to settle allegations that he gave Joseph C. Ruggieri, a stock trader, insider information on probable ratings charges. Ruggieri was not convicted of any crime.


Wells Fargo fake accounts scandal

In September 2016, Wells Fargo was issued a combined total of $185 million in fines for opening over 1.5 million checking and savings accounts and 500,000 credit cards on behalf of customers without their consent. The Consumer Financial Protection Bureau issued $100 million in fines, the largest in the agency's five-year history, along with $50 million in fines from the City and County of Los Angeles, and $35 million in fines from the Office of Comptroller of the Currency. The scandal was caused by an incentive-compensation program for employees to create new accounts. It led to the firing of nearly 5,300 employees and $5 million being set aside for customer refunds on fees for accounts the customers never wanted.
Carrie Tolstedt Carrie L. Tolstedt is an ousted American banking executive and former head of the community banking division at Wells Fargo, from which she retired in 2016 before the company's account fraud scandal came to light. In 2017, Wells Fargo retroactive ...
, who headed the department, retired in July 2016 and received $124.6 million in stock, options, and restricted Wells Fargo shares as a retirement package. On October 12, 2016, John Stumpf, the then chairman and CEO, announced that he would be retiring amidst the scandals. President and Chief Operating Officer
Timothy J. Sloan Timothy J. Sloan (born 1959/60) is an American banker. He was the chief executive officer (CEO) of Wells Fargo from October 2016 until he resigned in March 2019, after significant pressure related to an ongoing controversy related to an account ...
succeeded Stumpf, effective immediately. Following the scandal, applications for credit cards and checking accounts at the bank plummeted. In response to the event, the Better Business Bureau dropped accreditation of the bank. Several states and cities ended business relations with the company. An investigation by the Wells Fargo board of directors, the report of which was released in April 2017, primarily blamed Stumpf, who it said had not responded to evidence of wrongdoing in the consumer services division, and Tolstedt, who was said to have knowingly set impossible sales goals and refused to respond when subordinates disagreed with them. Wells Fargo coined the phrase, "Go for Gr-Eight" – or, in other words, aim to sell at least 8 products to every customer. The board chose to use a clawback clause in the retirement contracts of Stumpf and Tolstedt to recover $75 million worth of cash and stock from the former executives. In February 2020, the company agreed to pay $3 billion to settle claims by the United States Department of Justice and the
Securities and Exchange Commission The U.S. Securities and Exchange Commission (SEC) is an independent agency of the United States federal government, created in the aftermath of the Wall Street Crash of 1929. The primary purpose of the SEC is to enforce the law against market ...
. The settlement did not prevent individual employees from being targets of future litigation. The Federal Reserve put a limit to Wells Fargo's assets, as a result of the scandal. In 2020, Wells Fargo sold $100 million in assets to stay under the limit. In Dececember 2022, the bank agreed to a settlement with the CFPB of $3.7 billion over abuses tied to the fake account scandal as well as mortgages and auto loans. The total was split between $1.7 billion for a civil penalty and $2 billion for customers.


Racketeering lawsuit for mortgage appraisal overcharges

In November 2016, Wells Fargo agreed to pay $50 million to settle allegations of overcharging hundreds of thousands of homeowners for appraisals ordered after they defaulted on their mortgage loans. While banks are allowed to charge homeowners for such appraisals, Wells Fargo frequently charged homeowners $95 to $125 on appraisals for which the bank had been charged $50 or less. The plaintiffs had sought triple damages under the U.S. Racketeer Influenced and Corrupt Organizations Act on grounds that sending invoices and statements with fraudulently concealed fees constituted mail and wire fraud sufficient to allege racketeering.


Financing of Dakota Access Pipeline

Wells Fargo is a lender on the
Dakota Access Pipeline The Dakota Access Pipeline (DAPL) or Bakken pipeline is a underground pipeline in the United States that has the ability to transport up to 750,000 barrels of light sweet crude oil per day. It begins in the shale oil fields of the Bakken Forma ...
, a 1,172-mile-long (1,886 km) underground oil pipeline transport system in North Dakota. The pipeline has been controversial regarding its potential impact on the environment. In February 2017, the city councils of Seattle, Washington and Davis, California voted to move $3 billion of deposits from the bank due to its financing of the Dakota Access Pipeline as well as the Wells Fargo account fraud scandal.


Failure to comply with document security requirements

In December 2016, the Financial Industry Regulatory Authority fined Wells Fargo $5.5 million for failing to store electronic documents in a "write once, read many" format, which makes it impossible to alter or destroy records after they are written.


Doing business with the gun industry and NRA

From December 2012 through February 2018, Wells Fargo reportedly helped two of the biggest firearms and ammunition companies obtain $431.1 million in loans. It also handled banking for the
National Rifle Association The National Rifle Association of America (NRA) is a gun rights advocacy group based in the United States. Founded in 1871 to advance rifle marksmanship, the modern NRA has become a prominent Gun politics in the United States, gun rights ...
and provided bank accounts and a $28-million line of credit. In 2020, the company said that it is winding down its business with the
National Rifle Association The National Rifle Association of America (NRA) is a gun rights advocacy group based in the United States. Founded in 1871 to advance rifle marksmanship, the modern NRA has become a prominent Gun politics in the United States, gun rights ...
.


Discrimination against female workers

In June 2018, about a dozen female Wells Fargo executives from the wealth management division met in Scottsdale, Arizona to discuss the minimal presence of women occupying senior roles within the company. The meeting, dubbed "the meeting of 12", represented the majority of the regional managing directors, of which 12 out of 45 were women. Wells Fargo had previously been investigating reports of gender bias in the division in the months leading up to the meeting. The women reported that they had been turned down for top jobs despite their qualifications, and instead the roles were occupied by men. There were also complaints against company president Jay Welker, who is also the head of the Wells Fargo wealth management division, due to his sexist statements regarding female employees. The female workers claimed that he called them "girls" and said that they "should be at home taking care of their children."


Overselling auto insurance

On June 10, 2019, Wells Fargo agreed to pay $385 million to settle a lawsuit accusing it of allegedly scamming millions of auto-loan customers into buying insurance they did not need from National General Insurance.


Failure to Supervise Registered Representatives

On August 28, 2020, Wells Fargo agreed to pay a fine of $350,000 as well as $10 million in restitution payments to certain customers after the Financial Industry Regulatory Authority accused the company of failing to reasonably supervise two of its registered representatives that recommended that customers invest a high percentage of their assets in high-risk energy securities in 2014 and 2015.


Steering customers to more expensive retirement accounts

In April 2018, the United States Department of Labor launched a probe into whether Wells Fargo was pushing its customers into more expensive retirement plans as well as into
retirement fund A pension fund, also known as a superannuation fund in some countries, is any plan, fund, or scheme which provides retirement income. Pension funds typically have large amounts of money to invest and are the major investors in listed and priva ...
s managed by Wells Fargo itself.


Alteration of documents

In May 2018, the company discovered that its business banking group had improperly altered documents about business clients in 2017 and early 2018.


Executive compensation

With CEO John Stumpf paid 473 times more than the median employee, Wells Fargo ranked number 33 among the S&P 500 companies for CEO—employee pay inequality. In October 2014, a Wells Fargo employee earning $15 per hour emailed the CEO—copying 200,000 other employees—asking that all employees be given a $10,000 per year raise taken from a portion of annual corporate profits to address
wage stagnation Real wages are wages adjusted for inflation, or, equivalently, wages in terms of the amount of goods and services that can be bought. This term is used in contrast to nominal wages or unadjusted wages. Because it has been adjusted to account ...
and income inequality. After being contacted by the media, Wells Fargo responded that all employees receive "market competitive" pay and benefits significantly above US federal minimums. Pursuant to Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, publicly traded companies are required to disclose (1) the median total annual compensation of all employees other than the CEO and (2) the ratio of the CEO's annual total compensation to that of the median employee.


Fine due to consumer banking violation

Well's fargo was heavily fined due to evident wrong records of customer payments on home and auto loans. The bank had to pay $3.7 billion to resolve claims which harmed millions of customers.


Carbon footprint

Wells Fargo & Company reported Total CO2e emissions (Direct + Indirect) for the twelve months ending 31 December 2020 at 776 Kt (-87 /-10.1% y-o-y).Alt URL
/ref> There has been a consistent declining trend in reported emissions since 2015.


In popular culture

Wells Fargo stagecoaches are mentioned in the song "
The Deadwood Stage (Whip-Crack-Away!) "The Deadwood Stage (Whip-Crack-Away!)" is a song in the 1953 film ''Calamity Jane'', written by Sammy Fain and Paul Francis Webster, and performed by Doris Day. It was also used in the London stage show ''Calamity Jane'' in 2003 and the musical ba ...
" in the 1953 film '' Calamity Jane'' performed by
Doris Day Doris Day (born Doris Mary Kappelhoff; April 3, 1922 – May 13, 2019) was an American actress, singer, and activist. She began her career as a big band singer in 1939, achieving commercial success in 1945 with two No. 1 recordings, " Sent ...
: "With a fancy cargo, care of Wells and Fargo, Illinois - Boy!". Wells Fargo is also shown as the delivery service bringing the instruments for the town band in the 1962 film '' The Music Man''. A Wells Fargo & Company stagecoach is seen passing through the town of Hill Valley as Marty is walking down the street in the 1990 film, ''
Back to the future part III ''Back to the Future Part III'' is a 1990 American science fiction Western film and the final installment of the ''Back to the Future'' trilogy. The film was directed by Robert Zemeckis, and stars Michael J. Fox, Christopher Lloyd, Mary Stee ...
''


Charity

On March 2, 2022, Wells Fargo announced $1 mil donation to the American Red Cross that will be used for Ukrainian refugees fleeing from the Russian invasion. In April 2022, The Wells Fargo foundation announced its pledge of $210 million toward racial equity in homeownership. With $60 million of the donation awarded in Wealth Opportunities Restored through Homeownership (WORTH) grants which will run until 2025. Additionally, $150 million will be committed to lower mortgage rates and reducing the refinancing costs to aid minority homeowners.


See also

*
List of Wells Fargo directors The List of Wells Fargo Directors includes all members of the Board of Directors of the express mail company from its founding in 1852 until the cessation of its express service in 1918. It does not include the directors of the Wells Fargo Bank afte ...
* List of Wells Fargo presidents * Wells Fargo Arena *
Wells Fargo Center Wells Fargo Center may refer to: *Wells Fargo Center (Los Angeles), California *Wells Fargo Center (Sacramento), California * Wells Fargo Center (San Francisco), California * Wells Fargo Center for the Arts, Santa Rosa, California * Wells Fargo Cen ...
*
Big Four banks The Big Four (or Big 4) is the colloquial name given to the four main banks in several countries where the banking industry is dominated by just four institutions and where the phrase has thus gained relevance. Some countries include more or less i ...


References


External links

* {{Authority control 1852 establishments in New York (state) American companies established in 1852 Banks based in California Banks established in 1852 Companies based in San Francisco Companies listed on the New York Stock Exchange Financial District, San Francisco Mortgage lenders of the United States Online brokerages Systemically important financial institutions