As Wells Fargo’s new chief executive officer, Tim Sloan, tries to contain the sham-account scandal, Los Angeles authorities, former employees and community activists are examining if bank employees singled out Latinos, particularly those without Social Security numbers or a strong command of English, as they opened unauthorized accounts, Bloomberg News reported yesterday. The most serious allegations have been leveled by the city attorney’s office in Los Angeles, Wells Fargo’s biggest market and the bulwark of its stronghold in California. After illegal sales practices at the bank first came to light several years ago, the city attorney spent 16 months investigating whether employees had singled out Latinos in order to hit aggressive sales targets. Investigators alleged that Wells Fargo had in some cases targeted Mexican nationals with identification cards issued by consular offices. Read more.
In related news, Massachusetts yesterday joined a handful of other states suspending business with Wells Fargo & Co. amid the bank’s high-profile consumer fraud scandal, MorningConsult.com reported. Massachusetts Treasurer Deborah Goldberg has instructed an assistant treasurer to remove the lender from a list of approved underwriters for one year, said Chandra Allard, a spokeswoman for Goldberg. The move comes after Goldberg criticized Wells Fargo’s behavior in a statement and asked staff to review the state’s dealings with the bank, Allard said. Other states — Ohio, California, and Illinois — have also halted business relationships with Wells Fargo. The bank’s new CEO, Tim Sloan, told Bloomberg News last week that he expects to win back those states’ business. Read more.
