Wells Fargo puts off the chief executive and the auditor because of ongoing scandals

Both Wells Fargo's Chief Administrative Officer and Chief Auditor are on leave – and were excluded from the company's executive committee – following the bank's sham account scandal.

Hope Hardison has been the Administrative Manager of the San Francisco Bank since 2015. David Julian was appointed Chief Auditor in 2012.

For two years, the two leaders retained their position in the bank of assets, with a capital of 1 900 billion dollars, even though various scandals had caused the departure of many colleagues. That changed on Wednesday when Wells introduced a series of leadership changes resulting from the holidays.

"These authorizations relate to ongoing reviews previously disclosed by regulators in relation to historical sales practices in retail banking," the company said in a press release. "These leaves have nothing to do with the company's published financial results or internal financial controls."

Since the scandal that erupted in September 2016, Wells has revealed that no less than 3.5 million accounts have been opened without the permission of its clients. The outcry that followed resulted in the sudden departure of CEO John Stumpf, replaced by Tim Sloan, and a series of actions designed to end the scandal.

But over the past two years, Wells' reputation has been further tarnished by a series of additional scandals. Problems include abuses in the bank's mortgage and auto operations, a wealth management survey and refunds for complementary products.

Just this summer, Wells Fargo was already claiming that Hardison had made significant changes as a result of the unauthorized accounts scandal, such as the bank's decision to terminate sales targets for employees' products. agencies. Last month, American Banker designated her as one of the women to watch appearing on her annual list of the most influential women in the banking sector.

But Hardison also drew attention to his role in the scandal of unauthorized accounts.

In March 2017, Wells had announced that Hardison, Julian and six other top executives would not receive cash bonuses for the previous year to reinforce the scandal's liability. The bank pointed out that the reduction in compensation did not result from the discovery of inappropriate behavior.

The following month, a report from Wells Fargo's board of directors revealed that Hardison had been aware of business-related issues since she became the company's chief human resources officer in 2010. But she concluded that did not understand that the problems were ubiquitous.

In February 2013, a Wells Fargo employee who reported to Hardison sent him a report indicating more than 2,000 confirmed fraud or policy violations, as well as layoffs and resignations in 2011 and 2012, according to the committee's report.

"Hardison did not recall having reviewed this report in detail or having understood at that time the extent and nature of the violations of the integrity of the sale," the report said.

The commission's report also described Hardison as someone whom some of his colleagues had ignored the warnings about the growing scandal.

For example, he stated that after learning about the existence of about 1,000 new employee layoffs in 2013 for breach of sales integrity, Ms. Hardison had criticized the retail service of the bank.

As Chief Executive Officer, Hardison also underwent a thorough review of the company's treatment of employees who have reported abuse of sales. Some former employees alleged that they had been fired after reporting misconduct.

The 2017 Board Report indicated that the Shearman & Sterling law firm had not seen systematic retaliation against employees who complained of commercial pressure. Hardison told The New York Times last year, "If we find cases where someone in this company has not behaved properly, we want to fix it."

Wednesday's Wells Fargo press release did not explain what had recently been motivated by staff changes, but instead focused on what would follow.

"Because of the depth of our management team, we are confident in our ability to ensure an effective transition," Sloan said in the press release.

As a result of the staffing actions, Kimberly Bordner, who is currently the Chief Audit Executive, will become the Acting Chief Auditor, Wells Fargo said. David Galloreese will remain at the helm of human resources, report directly to CEO Tim Sloan and join the bank's operating committee.

Three other members of the company's operating committee – John Shrewsberry, Chief Financial Officer, Mandy Norton, Risk Manager, and Avid Modjtabai, Payments, Virtual Solutions and Innovation Manager – will assume responsibilities that were previously the responsibility of Hardison .

Regulators continue to closely monitor Wells Fargo, which remains subject to an order by the US Federal Reserve prohibiting the bank from increasing its assets until it improves its governance and controls.

On Monday, New York State Attorney General Barbara Underwood fined Wells $ 65 million for failing to disclose that its once-popular cross-selling ratio was based on a misconduct of the share of an employee.

"The misconduct in Wells Fargo has been widespread across the bank and at all levels of management, affecting both misled clients and investors," Underwood said in a press release.