Wells Fargo CEO gets an earful from shareholders
Just last week, Wells Fargo (WFC) agreed to pay a $1 billion fine to the government to settle consumer lending abuse complaints. And at the company's shareholder meeting today, Wells Fargo CEO Tim Sloan heard about those abuses -- and more.
The meeting featured emotional appeals from customers who had lost their homes and was briefly interrupted by the chants of protesters, but Sloan also wound up deflecting calls for the bank to cut its ties with gunmakers and the oil and gas industries.
Wells Fargo "has harmed and wounded millions of its customers who lost their homes and in no small measure their dignity all because the company failed them," said Nora Nash of the sisters of St. Francis of Philadelphia. The nuns are members of the Interfaith Center on Corporate Responsibility, or ICCR, which recently withdrew a resolution for the 2018 proxy calling for a report on the bank's ethical lapses after Wells Fargo agreed to work with the group.
But Nash had other objections as well. "Our bank is seen as the leading lender to the gun industry," she said. Wells Fargo and other corporations should take responsibility for their operations and supply chain and not be associated with makers of military weapons, the nun and activist said. "We have far to go."
"We must stop the gun violence epidemic in our country," Jordan Ash, a researcher with the St. Paul Federation of Teachers, a Minnesota affiliate of the American Federation of Teachers, or AFT, told the gathering in Des Moines, Iowa.
He then blasted the bank's financial support of the National Rifle Association, saying "the NRA has launched shameful attacks on student survivors," a reference to criticism of teen activists from Marjory Stoneman Douglas High School in Parkland, Fla., where 17 people were shot to death in February.
Roughly 1,600 AFT member families received mortgages from Wells Fargo in 2017, Ash noted. The teachers' union last week notified Wells Fargo that it was dropping the bank as a recommended mortgage lender for its 1.7 million members.
"We think gun safety and gun violence are best addressed by legislation," Sloan responded. "What we've done is we've promised to engage with our customers in that industry and provide them with feedback that we're hearing."
California Treasurer John Chiang spoke multiple times at the meeting, calling for the ouster of John Baker from the bank's board of directors for being among those at the helm when the bank'a consumer abuses were taking place. However, the election of Baker and 11 other board nominees was approved at the meeting.
Sloan, a 30-year veteran at the bank, "has not drained the swamp, he has become it," declared Chiang, a Democrat who's also a California gubernatorial candidate.
During his presentation, Sloan said Wells Fargo had made "significant progress" in rebuilding trust in its brand, but also acknowledged more work remained.
The CEO touted the bank raising its wages to $15 an hour for 50,000 employees and said it had made changes that helped more than 800,000 customers avoid overdraft charges in the last year.
He told one distraught former homeowner from California making her second appearance at an annual meeting that Wells Fargo had tried its best to help her, but her mortgage "was not on our books" but rather was being serviced by Wells Fargo on behalf of investors to whom it had been sold.
Another California resident trying to avoid a default by restructuring her mortgage with Wells Fargo told Sloan she had been denied more than 30 times for reasons including "failure to submit my husband's earnings, and I've never been married."
The bank's "casual patterns of abuse is more harmful to me than the actual cancer and chemotherapy which I survived," the woman said, drawing a promise from Sloan that someone from Wells Fargo's mortgage business would meet with her after the meeting. "I apologize for the service you received," the CEO said.
Hearing from members of Indian tribes unhappy about the bank's financing of the Dakota Access Pipeline, Sloan said Wells Fargo did have a relationship with TransCanada (TRP), developer of the controversial project. But he added that the bank also financed wind and other green energy projects.
After a brief interruption by a smattering of protesters chanting "Wells Fargo, you're the worst, put the people and the planet first," the company announced that three management proposals had been approved -- including one in favor of the bank's executive compensation plan -- by a majority of shareholders, while three advanced by shareholders had failed.
Sloan last month was given a $17.4 million compensation package for 2017, most of it in restricted stock.
