Wells Fargo CEO John Stumpf will forfeit much of his 2016 salary -- including his bonus and $41 million in stock awards -- as the bank launches a probe into its phony accounts scandal. 
 
 The fallout from the controversy has also resulted in its first major executive departure. Carrie Tolstedt, who headed the division that created the fake accounts, has left the company ahead of her scheduled retirement at year end. 
 
 Wells Fargo, under pressure from lawmakers and shareholders to take action, said Tolstedt will not receive a bonus or severance, and that she'll forfeit all of her $19 million worth of unvested stock awards. Wells Fargo also said Tolstedt has agreed not to exercise some $34 million in stock options, the bank's independent directors announced Tuesday. 
 
 However, Tolstedt could still be walking away with a fortune despite running the retail bank during the entire time the unauthorized accounts were opened. 
 
 Tolstedt owns roughly $43.3 million in stock outright that she accumulated during her career with the bank, according to a letter Wells Fargo sent to Senator Elizabeth Warren. That means if she is allowed to keep her stock options, Tolstedt could leave Wells Fargo with stocks and options valued today at roughly $77 million. 
 
 Related: Wells Fargo fake accounts head could still walk with $77 million 
 
 Wells Fargo's board of directors also said Tuesday that it's launching an independent investigation into the company's sales practice. The new probe comes as employees told CNNMoney that the practice of opening fake accounts began years earlier than Wells Fargo has previously acknowledged. 
 
 During the company's investigation, Stumpf will work for free. 
 
 Stephen Sanger, the board's lead independent director, said the executives could face further penalties, depending on the results of the investigation. 
 
 He said in a statement that the board may claw back additional compensation or take "other employment-related actions." It's not clear if that could include forcing out Stumpf, who Warren and others have demanded should resign. 
 
 If they're cleared of wrongdoing, both Stumpf and Tolstedt may end up taking home some of their hefty pay packages. 
 
 The decision to "claw back" Stumpf's and Tolstedt's compensation comes just before Thursday's big Wells Farg (WFC)hearing in front of the House Financial Services Committee and amid a string of embarrassing headlines about the opening of unauthorized accounts. 
 
 Wells Fargo paid Stumpf $19.3 million in total compensation for 2015, in part as a reward for the bank's growing number of accounts. Millions of those accounts, as it's been since revealed, were fake. An intense focus from top management on adding new accounts, former employees say, led to a pressure-cooker atmosphere at Wells Fargo. 
 
 Related: Fired Wells Fargo workers fight back with lawsuit 
 
 Last year, Stumpf was awarded with $4 million for various factors that included growing "primary consumer, small business and banking checking customers." Wells Fargo also rewarded Stumpf last year for his success in "reinforcing a culture of risk management and accountability across the company." 
 
 That bonus led Jeffrey Sonnenfeld, an authority on corporate governance at Yale University, to say that "without a doubt" some of Stumpf's pay should be clawed back. "He should be docked," Sonnenfeld said. 
 
 A CNNMoney analysis, conducted prior to the clawbacks, showed that if he were to leave, Stumpf could leave Wells Fargo with about $200 million of cash, Wells Fargo stock and options. 
 
 Last week, Warren slammed Stumpf for "gutless" leadership, in part for his refusal to cut compensation for Tolstedt, who led Wells Fargo's community banking division during the entire time fake accounts were created. 
 
 Warren also came down heavy on Stumpf on his own pay: When it all blew up, you kept your job, you kept your multimillion dollar bonuses, and you went on television to blame thousands of $12-an-hour employees who were just trying to meet cross-sell quotas that made you rich." ||||| The longtime chief executive of Wells Fargo agreed on Tuesday to forfeit $41 million in performance pay three weeks after the bank acknowledged that for at least five years, thousands of low-level employees set up sham accounts to meet sales quotas. 
 
 The San Francisco-based bank has repeatedly apologized for the scheme and said it had fired 5,300 employees for misconduct and put in place more stringent internal controls. But that has not been enough for lawmakers, who have been pushing for the company’s top leaders to give back the millions of dollars in bonuses they earned while the irregularities were occurring. 
 
 The independent directors of the Wells Fargo board announced Tuesday that they were launching an investigation into the bank’s retail business. 
 
 “We are deeply concerned by these matters, and we are committed to ensuring that all aspects of the Company’s business are conducted with integrity, transparency, and oversight,” Stephen Sanger, the lead independent director, said in a statement. Sanger, who has been a member of Wells Fargo’s board since 2003, is the former chairman of General Mills, the packaged-food company. 
 
 John Stumpf, the chief executive, will forfeit unvested stock awards worth about $41 million, will not receive a salary while the investigation is underway and will not be eligible for a 2016 bonus, the committee said in a statement. Carrie Tolstedt, the former head of Wells Fargo’s community banking unit, where the misconduct took place, will give up $19 million in unvested stock awards and not be eligible for a 2016 bonus. Tolstedt had announced her retirement in July but had initially planned to stay at the bank until the end of the year. 
 
 In a tense exchange, Senator Elizabeth Warren badgered Wells Fargo CEO John Stumpf on why he had not offered to give up any of his compensation or to resign in the wake of the fake accounts controversy. (Reuters) 
 
 Stumpf and Tolstedt still have millions of dollars in stock and other compensation from Wells Fargo. Stumpf, for example, was awarded $161 million in bonuses and performance awards between 2011 and 2015, the period in which the misconduct took place, according to Equilar, a research firm. Tolstedt was awarded more than $60 million in bonuses in the same period. 
 
 But this action by the bank’s board is, by far, the most aggressive and public effort by a bank since the 2008 financial crisis to show that top executives will be held responsible for their companies’ misdeeds. 
 
 In early September, Wells Fargo was fined $185 million by regulators after it discovered that thousands of employees were setting up unauthorized accounts, including credit cards and checking accounts, that customers had not requested. In some cases, the customers were charged various fees for accounts they did not know existed. 
 
 The case has sparked a national outcry, with lawmakers pummeling Stumpf before the Senate Banking Committee last week, with one even calling on him to resign. He is to be the only witness before the House Financial Services Committee when he attends a hearing this week, and the move to take back financial awards could help head off some of the inevitable anger of lawmakers. 
 
 The debate comes as regulators try to finalize rules called for by the 2010 financial-reform bill, known as Dodd Frank, to overhaul the way Wall Street executives are paid and to address years of complaints that excessive bonuses helped lead to the 2008 financial crisis. 
 
 The long-awaited rules were aimed at stopping executives from making risky financial bets to boost their pay and then collecting large bonuses before the consequences of their actions are clear. But the banking industry is mounting a counterattack against the rules, which critics say do not allow enough flexibility. Some employees would be subject to claw-backs for up to 11 years after being awarded bonuses, much longer than the current industry standard of three to five years, industry officials have said. 
 
 In July, Wells Fargo joined the debate, saying it was concerned that the rules may have unintended consequences. “We have worked, and are continuing to work, diligently . . . to improve and evolve our incentive-based compensation practices,” Hope Hardison, Wells Fargo’s director of human resources, said in a letter to regulators. 
 
 But the rules would “create an un-level playing field, driving high-quality talent” away from big banks subject to the rules, she wrote. 
 
 The controversy surrounding Wells Fargo is likely to make it more difficult for banks to mount efforts to weaken the rules, industry officials say. 
 
 Stumpf is expected to face tough questioning when he appears before the House Financial Services Committee on Thursday. In addition to questions about executive compensation, he is likely to face questions about a recently launched Labor Department inquiry into the bank. 
 
 The Labor Department says it is conducting a “top-to-bottom review” of Wells Fargo after lawmakers complained that the bank’s workers were forced into a hypercompetitive environment that led thousands of them to set up the sham accounts to meet aggressive sales goals. 
 
 Some former employees allege that they were unfairly fired when they did not cut corners to meet Wells Fargo’s aggressive sales targets. 
 
 That could violate federal rules, according to lawmakers and some labor experts. Last week, former Wells Fargo employees who say they were fired for following the law filed a $2.6 billion lawsuit against the bank. They are seeking class-action status. 
 
 The Labor Department said it has set up a working group to expedite a review of the issue. 
 
 “Given the serious nature of the allegations . . . I have directed enforcement agencies within the Department to conduct a top-to-bottom review of cases, complaints, or violations concerning Wells Fargo over the last several years,” Labor Secretary Thomas Perez said in a letter released Tuesday by Sen. Elizabeth Warren (D-Mass.), who had asked the agency to look into the matter. 
 
 “We take the concerns raised . . . very seriously,” Perez wrote. 
 
 A Wells Fargo spokeswoman declined to comment on the Labor Department review. 
 
 It is just the latest sign that San Francisco-based bank will be grappling with the fallout from this case for some time. Federal prosecutors are considering civil or criminal charges against the bank. ||||| Skip in Skip x Embed x Share CLOSE Watch the headlines since the news broke. Time 
 
 Former Wells Fargo CEO John Stumpf appearing before a Congressional panel. (Photo: EPS) 
 
 At Wells Fargo, two former executives are giving back and some of its once former employees are going back. 
 
 Wells Fargo said Monday it is clawing back $75.3 million in additional compensation from top former executives after an internal investigation of the bank's unauthorized accounts scandal found that the ex-leaders acted too slowly to investigate allegations of "improper and unethical behavior" in retail sales practices reaching back more than a decade. 
 
 The clawbacks are among the highlights of a report that said aggressive sales practices in the community banking division of Wells Fargo (WFC) for years distorted "culture and management performance" and "created pressure on employees to sell unwanted or unneeded products to customers, and, in some cases, to open unauthorized accounts." 
 
 Also on Monday, Wells Fargo CEO Tim Sloan said that roughly1,000 employees who left the bank over the questionable sales procedures have been rehired. 
 
 Produced by independent board members of the bank, along with outside legal investigator, the report blasted Wells Fargo executives for failing to properly investigate the activity, cultivating an atmosphere of unrealistic expectations and hiding information about the extent of the crisis that ultimately led to millions of dollars in fines, plus lawsuits and additional investigations. 
 
 Wells Fargo board Chairman Stephen Sanger also acknowledged in a Monday conference call with reporters that board members "could have pushed more forcefully to change leadership at the community bank." 
 
 While conceding he could not "promise perfection" in the efforts to regain trust from customers and regulators, Sloan said, "I'm very confident we're on the right track." 
 
 He succeeded former CEO John Stumpf who resigned in October amid the scandal fallout. Stumpf will lose an additional $28 million in compensation beyond the $41 million and 2016 bonus he previously agreed to forgo, the report said. 
 
 The report also said the bank has canceled $47.3 million in additional stock options owed to Carrie Tolstedt, who previously headed the community banking division where the scandal erupted. Tolstedt, who previously lost $19 million in compensation, resigned in June. 
 
 The report's findings compound the San Francisco-based bank's crisis ahead of an April 25 annual meeting, where board members will stand for reelection. Stockholder advisory group Institutional Shareholder Services last week recommended that Wells Fargo shareholders vote against re-election for 12 of the company's 15 directors. Wells Fargo, which is scheduled to report quarterly earnings on Thursday, last week rejected the ISS recommendation. 
 
 Stumpf could not be reached for comment. However, Stumpf "took responsibility" for the improperly aggressive practices, and was "totally cooperative" with investigators, said Stuart Baskin, a Shearman & Sterling law firm partner involved in the bank's internal investigation. 
 
 Tolstedt declined to be interviewed on the advice of legal counsel, Baskin said. An attorney for Tolstedt, Enu Mainigi, in a formal statement said: “We strongly disagree with the report and its attempt to lay blame with Ms. Tolstedt. A full and fair examination of the facts will produce a different conclusion.” 
 
 . 
 
 In all, Wells Fargo has acknowledged it may have opened up to 2.1 million accounts without customers' permission, along with unwanted credit cards and other financial products. The sales resulted from community bank managers pressing lower level bank employees to meet aggressive cross-selling targets that for years had made Wells Fargo the envy of the banking industry as the sales boosted the bank's bottom line. 
 
 But the sales practices also triggered numerous complaints from employees. Spurred in part by a December 2013 report on the practices by the Los Angeles Times, the Office of the Comptroller of the Currency, the Consumer Financial Protection Bureau and the Los Angeles City Attorney's office hit Wells Fargo with $185 million in fines and penalties last year. 
 
 At that time, Wells Fargo acknowledged that an estimated 5,300 employees had been fired as the magnitude of the sales excesses emerged. Many bank workers complained that they had been victimized for acceding to their bosses' sales demands. Tolstedt allegedly "minimized and understated" the problems in a 2015 report to the board, whose members only learned of the extent of the employee firings when regulators penalized Wells Fargo last year. 
 
 The bank took action after the penalties, launching its internal probe even as lawsuits mounted and new investigations by the Department of Justice and the Securities and Exchange Commission got underway. 
 
 In addition to clawing back compensation from Stumpf and Tolstedt, the bank on Feb. 28 reduced compensation for eight current executives by $32 million, including eliminating 2016 bonuses and halving 2014 performance payouts. Although the internal report found that Sloan's "direct involvement with sales practice issues was limited," his 2016 bonus and 2014 performance share payouts were reduced as part of the compensation cuts. 
 
 Related: 
 
 Additionally, Wells Fargo in January overhauled its compensation plan to remove financial incentives for aggressive sales of financial products to customers. Four present or former senior managers were fired the following month for their alleged involvement in the scandal. On Monday, Sanger said no additional firings or compensation clawbacks are planned. 
 
 As part of the investigation, Shearman & Sterling conducted 100 interviews with current and past workers, reviewed more than 35 million documents and coordinated with FTI Consulting to conduct forensic analysis of the bank's digital archives. 
 
 Wells has previously acknowledged that aggressive sales incentives and pressure prompted many frontline bank employees to open fake accounts to meet their goals. The report focused on that issue at length, blaming senior executives for tolerating "low-quality accounts" and failing to terminate the people responsible for them. 
 
 The internal report singled out Tolstedt for allegedly having been "insular and defensive" and having "effectively challenged and resisted scrutiny from within and outside" her community banking division. 
 
 Stumpf downplayed problems and failed to investigate the allegedly unethical activity when the possibility of problems came to his attention, according to the report. "Stumpf's long-standing working relationship with Tolstedt influenced his judgment," leading him to stand by her even though "he was aware that many doubted that she remained the right person" to continue leading the division involved in the scandal, the report concluded. 
 
 When an internal investigation launched after the Los Angeles Times report revealed that about 1% of Wells Fargo employees were fired annually for sales integrity violations, Stumpf and Tolstedt "received the figure positively," according to the bank's internal probe. 
 
 "Stumpf was by nature an optimistic executive who refused to believe that the sales model was seriously impaired," the report said. "His reaction invariably was that a few bad employees were causing issues, but that the overwhelming majority of employees were behaving properly. He was too late and too slow to call for inspection of or critical challenge to the basic business model." 
 
 While the report tried to close a chapter on major parts of the scandal, at least one issue remains. Shearman & Sterling investigators have not identified a pattern of retaliation against Wells Fargo employees who complained about the sales practices. But interviews and record-checking involving potential whistleblowers are continuing, the report said. 
 
 Follow USA TODAY reporters Nathan Bomey and Kevin McCoy on Twitter: @NathanBomey and @kmccoynyc 
 
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– John Stumpf, the Wells Fargo CEO slammed for his "gutless leadership" by Sen. Elizabeth Warren last week, is going to have to tighten his belt a little this year: He will forfeit his bonus, part of his salary, and $41 million in stock awards over the fake-account scandal that saw the sacking of 5,300 employees, CNN reports. In addition, Stumpf will work for free while the company conducts an investigation. The bank's board of directors also says Carrie Tolstedt, who headed the retail division where workers created the phony accounts, will forfeit at least $19 million of the $125 million she was going to leave the company with at the end of the year, and will not receive severance or a bonus for 2016. The announcement comes as Wells Fargo is set to go before the House Financial Services Committee on Thursday. The board says it is launching an independent investigation into how millions of accounts were created without the permission of customers, the BBC reports. Wells Fargo was fined $185 million over the scandal and the Washington Post describes the board's cash clawback as "by far the most aggressive and public effort" since the 2008 financial crisis to punish bank chiefs for misconduct—although Stumpf still has the estimated $161 million he received in bonuses over the five years the scam took place, and Tolstedt received $60 million over the same period. (Wells Fargo whistleblowers say they were fired for speaking out.)