Consumer lending, insurance issues to weigh on Wells' CEO's Senate appearance on Tuesday

Consumer lending, insurance issues to weigh on Wells' CEO's Senate appearance on Tuesday
From Reuters - October 3, 2017

(Reuters) - Wells Fargo & Co (WFC.N) CEO Tim Sloan will be questioned about sales practices, mischarging customers for auto insurance, and complaints about mortgage fees at the banks consumer lending unit when he testifies before U.S. senators on Tuesday.

The U.S.s third-largest bank has yet to shake off a year-long sales practices scandal that has hammered its reputation, sparking management changes, lawsuits and government investigations.

Reuters reported on Monday that the Office of the Comptroller of the Currency, the leading regulator for Wells Fargo, was considering new sanctions against the bank for customer abuses involving auto insurance and mortgage loans.

Wells Fargo reached a $190 million settlement with regulators a year ago after it said it had opened as many as 2.1 million accounts without customers authorization to meet internal sales target.

That estimate was raised to potentially as many as 3.5 million in August after an expanded review.

Sloan, appearing before the Senate for the first time as chief executive, is keen to reassure lawmakers that the San Francisco-based bank has moved on from the scandal and will highlight changes he has made including overhauling the structure and senior management of its retail bank.

But with the emergence of more recent problems in other products, including auto insurance and mortgages, he faces a tough task.

The stakes are high for Sloan, a 30 year company veteran. His predecessor, John Stumpf, resigned less then a month after he earlier appeared before the same committee to answer questions about the banks sales practices.


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