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Business

REUTERS
January 14, 2018

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Wells Fargo gets tax boost

Wells Fargo gets tax boost

NEW YORK: Wells Fargo & Co is not certain it has fully uncovered and fixed all problems related to a long-running sales scandal that has hurt the bank´s reputation and sideswiped its efforts to cut costs, Chief Executive Tim Sloan said on Friday.

The third-largest U.S. bank by assets set aside a $3.25 billion reserve to cover litigation related to fake accounts and other customer issues in its fourth-quarter earnings on Friday.

The San Francisco-based company has been working to get to the bottom of its problems for more than a year, after reaching a $190 million settlement with regulators in September 2016 for employees creating phony bank and credit card accounts in customers´ names without their permission.

Since then, it has discovered other problems in businesses ranging from mortgages to foreign exchange trading, while the number of possibly made-up accounts swelled to 3.5 million.

Wells Fargo has tried to rectify the situation by changing how employees get paid, improving corporate reporting structures and ousting several executives. Sloan´s predecessor, John Stumpf, abruptly retired after the scandal came to light. However, the bank is still scouring businesses for evidence of bad behavior, a process that will continue indefinitely, Sloan said on a conference call in response to an analyst who asked repeatedly why management could not give assurances that problems were resolved.

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