Just days after he faced a tough grilling on Capitol Hill, Wells Fargo chief executive John Stumpf resigned from an advisory role with the Federal Reserve.
Stumpf has left his position as a representative for the Twelfth District on the Federal Advisory Council, the San Francisco Fed said Thursday. In his role, Stumpf was part of a team of 12 representatives from the banking industry who consulted with the Federal Reserve Board of Governors about four times a year about banks and the economy.
Stumpf is working to regain customers’ trust and rebuild the bank’s reputation after it became widely known that employees opened more than 2 million credit card and deposit accounts without customers’ approval. Earlier this month, regulators fined Wells Fargo $185 million for the scheme, which also included cases of workers moving customers’ money without permission to fund the sham accounts.
In a statement, the bank said Stumpf’s resignation from the council was a “personal decision.” “His top priority is leading Wells Fargo,” the statement said.
On Tuesday, Stumpf testified before a Senate panel about the changes the bank has made since 2011 to stop the activity, including lowering sales targets, more rigorous training for employees and creating a new alert system that notifies customers when a new account is opened in their name.
Wells Fargo has fired 5,300 employees since 2011 who were involved with the fake accounts. But many lawmakers are asking that Stumpf and other executives be held accountable. At the hearing, Sen. Elizabeth Warren (D-Mass.) called on Stumpf to resign after the scandal and to give back some of his compensation — he earned $19 million last year.
Warren and four other Democratic senators sent a letter Thursday to the San Francisco Fed asking officials not to reappoint Stumpf, who was on his second term. (Members to the Federal Advisory Council are appointed for one-year terms each January.) It was unclear whether the letter played a role in his resignation.
“It would be ironic if the Federal Reserve … continued to receive special insights and recommendations from senior management of a financial institution that just paid a record-breaking fine to the Consumer Financial Protection Bureau for ‘unfair’ and ‘abusive’ practices that placed consumers at financial risk,” the letter read.
Stumpf has also been called to testify at a hearing of the House Financial Services Committee next Thursday.