BOSTON Oct 10A group of nuns and other
religiously-affiliated investors have lost faith in embattled
Wells Fargo & Co and filed a shareholder resolution
calling on the bank to report on the root causes of a fake
accounts scandal that led to a $190 million settlement struck
with regulators last month.
The faith-based investors say they also want the report to
cover improved controls after revelations bank employees opened
as many as 2 million checking, savings and credit card accounts
without the customers' permission in order to meet sales quotas.
The resolution resembles one the Sisters of St Francis of
Philadelphia and others filed for the bank's 2014 annual meeting
and then withdrew, on the understanding the San Francisco-based
bank would provide more specifics on areas like its risk
But that did not happen, said Sister Nora Nash, a nun who is
director of corporate social responsibility for the Catholic
religious order, despite a series of meetings held in person and
by phone with bank leaders including Wells Fargo lead
independent director Stephen Sanger and a top ethics officer,
"They haven't done what we would have," said Nash in a
telephone interview. "Now it is biting them in the face."
Wells Fargo spokesman Oscar Suris declined to comment.
The resolution is one among a series filed recently at Wells
Fargo, including several from other investor groups affiliated
with the Interfaith Center on Corporate Responsibility in New
York. Other resolutions call on Wells Fargo to study a breakup
and to split the roles of chairman and chief executive officer.
All cite the Sept. 8 settlement Wells Fargo struck with bank
regulators over the accusations. Other authorities have since
begun probes, while CEO John Stumpf faces political pressure and
calls to resign.
The shareholder resolutions, proposed for the bank's annual
meeting to be held next spring, show how the tables have turned
for Wells Fargo.
Coming out of the financial crisis, it initially appeared to
take less criticism than other large lenders including JPMorgan
Chase & Co and Bank of America.
Both agreed under pressure from religious investors to
provide reviews of their business practices in reports that
amounted to mea culpas.
"In some cases, our controls fell short, and in others, we
simply weren't meeting the standards we had set for ourselves,"
JPMorgan said in a 2014 report. (reut.rs/2dBb0kY)
Wells Fargo's board has taken some steps since the
settlement to address concerns, such as starting their own
investigation and having Stumpf forfeit $41 million worth of
unvested stock awards and his 2016 bonus.
But the religious shareholders now say they need more
changes. For instance another resolution filed by the Unitarian
Universalist Association calls on Wells Fargo's board to study
how to connect executive pay with ethical conduct.
Tim Brennan, the association's treasurer, said that while
Wells Fargo already has a code of conduct, the scandal shows the
code "had nothing to do with the way the business was
(Reporting by Ross Kerber; Editing by Alan Crosby)