The Office of the Currency Controller (OCC), a U.S. banking regulator, began its civil lawsuit on Monday against three former Wells Fargo executives for their alleged role in a scandal involving a fake account with the San Francisco lender.
The proceedings before an OCC internal judge in Sioux Falls, SD, mark a rare public confrontation between the regulator and former banking executives who he says are partly to blame for Wells Fargo’s misconduct.
The OCC alleges that former Wells Fargo risk manager Claudia Russ Anderson, former chief auditor David Julian and former chief audit officer Paul McLinko did not properly perform their duties and responsibilities. which contributed to Wells Fargo’s “systemic sales practice misconduct” from 2002 to 2016.
The regulator filed civil charges last year against the trio, as well as other former Wells Fargo executives, and has demanded that they pay nearly $ 19 million together to resolve the matter. It also seeks to exclude Russ Anderson from the banking industry for allegations of direct violations of laws and regulations.
The long-running Wells Fargo trade pressure scandal that led staff to open millions of unauthorized or fraudulent customer accounts has cost the bank billions of dollars in civil and criminal sanctions and severely damaged its reputation. .
“The record reflects that, at the very least, the misconduct of 2013-2016 sales was widespread and widespread,” Administrative Law Judge Christopher McNeil said in initial statements detailing the allegations against each of the former executives.
Russ Anderson, Julian and McLinko are fighting the charges. The trio’s attorneys did not respond to requests for comment, but a lawyer representing Julian raised allegations of possible bias and credibility issues from government examiners in opening motions, hinting at a potential defense strategy.
A Wells Fargo spokesman declined to comment beyond a January 2020 statement in which CEO and President Charlie Scharf said the OCC’s actions were consistent with the firm’s and individuals ’responsibility to “inexcusable” sales practice problems.
“This hearing represents the culmination of the OCC’s long-standing efforts to hold these people accountable for material failures in risk management and consumer harm,” the OCC said in a statement Friday, which predicted that the trial would last at least two weeks.