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Wells Fargo's chief executive, John Stumpf, is to resign immediately in the wake of a scandal over its sales practices, the bank has announced.

The bank is investigating how two million accounts were opened without customers' permission.

Last month, it said Mr Stumpf, who was paid $19.3m last year, would not receive a salary during the inquiry.

He will be succeeded by the bank's current president and chief operating officer, Timothy Sloan.

The bank's independent chairman, Stephen Sanger, will take over as board chairman.

Last month, Wells Fargo was fined $185m and accused of "widespread illegal practice" by US regulators.

The fine imposed on the bank by the US Consumer Financial Protection Bureau was the largest to date by the watchdog.

"While I have been deeply committed and focused on managing the company through this period, I have decided it is best for the company that I step aside," Mr Stumpf said.

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Wells Fargo has fired more than 5,000 staff in response to the scandal.

The bank has said it will be contacting every deposit customer across the country to see if their accounts were properly authorised.

It will also contact hundreds of thousands of customers with valid credit cards to see if they want or need those cards.

In the future, confirmation emails will be sent to customers within one hour of the opening of a new deposit account.

The bank's former head of retail operations, Carrie Tolstedt, has forfeited $19m of bonuses and left without a payoff.</s>Wells Fargo’s embattled CEO John Stumpf is stepping down as the nation’s second-largest bank is roiled by a scandal over its sales practices.

The San Francisco bank said Wednesday that Stumpf is retiring effective immediately and also relinquishing his title as chairman. It had earlier announced that Stumpf, the bank’s CEO since 2007, will forfeit $41 million in stock awards.

 Wells Fargo’s chief operating officer, Tim Sloan, will succeed Stumpf as CEO. Stephen Sanger, the bank’s lead director, will serve as the board’s non-executive chairman.

Stumpf faced congressional hearings and consumer wrath last month after Wells Fargo was found to have opened millions of unauthorized bank accounts.

Wells Fargo & Co. had been well-known in the banking industry for its ability to sell customers multiple products, such as a new account, a mortgage, a retirement account, or even online banking. The company has agreed to pay $185 million to settle allegations that its workers opened millions of accounts without customers’ permission to reach aggressive sales targets.

Stumpf, a 34-year veteran of the bank, gained acclaim for navigating Wells Fargo through the financial crisis and keeping it free of scandal. But he came under withering pressure over the alleged misconduct, believed to have gone on at the bank for years. Some 5,300 lower-level employees were fired.

Wells Fargo is the biggest bank in Minnesota by deposit market share.</s>Embattled Wells Fargo CEO John Stumpf will retire effective immediately, the company announced Wednesday, marking a stunning downfall for one of the banking industry's most powerful figures.

The Wells Fargo (WFC) boss is out in the wake of a national uproar that erupted after regulators accused the bank of creating many as two million fake bank and credit card accounts. The company admitted to firing 5,300 workers over several years.

A person familiar with the matter said that Stumpf made the decision to retire, which was welcomed by the board.

Stumpf's resignation comes after Senator Elizabeth Warren publicly condemned him for "gutless" leadership at a Sept. 20 Senate hearing. "You should resign. ... You should be criminally investigated," Warren told Stumpf during a fiery one-sided exchange.

On Wednesday, Warren applauded Stumpf's decision to leave the helm of the company, tweeting "As I said: @WellsFargo CEO Stumpf should resign, return every nickel he made during the scam, & face DOJ/SEC investigation. He's 1 for 3."

The hearing, and another similarly blistering dressing down of Stumpf before House lawmakers a week later, may have helped speed up Stumpf's demise. While the bank CEO said he was "deeply sorry" and insisted there was no "scheme" to scam customers, he struggled at times to answer lawmakers' questions. He often gave the impression he wasn't fully in charge of the company.

Jeffrey Sonnenfeld, an authority on corporate governance at Yale, said Stumpf proved to be a "deer caught in the headlights with a tin ear in understanding, addressing, and communicating the problem."

Ironically, Stumpf prided himself on Wells Fargo's work ethic. In a 2015 Fortune interview he called himself the "keeper of our company's culture."

Related: I called the Wells Fargo ethics line and was fired

Yet former Wells Fargo employees believe it was precisely the bank's pressure-cooker sales environment that spurred staffers to open thousands of fake accounts.

The scandal swelled when nearly a half-dozen ex-Wells Fargo workers told CNNMoney they believe they were fired in retaliation for calling the ethics line about improper sales tactics. "They ruined my life," said Bill Bado, who was fired in 2013 for "tardiness" after alerting HR about fake accounts.

Stumpf, 63, worked for the bank for 34 years, and has served as its CEO since 2007.

"I am grateful for the opportunity to have led Wells Fargo," Stumpf said in a statement Wednesday. "While I have been deeply committed and focused on managing the Company through this period, I have decided it is best for the company that I step aside."

Stumpf made $19.3 million in 2015. But amid the scandal, he agreed to forfeit much of his 2016 salary, including his bonus and $41 million in stock awards, as the bank launched an internal investigation into the phoney accounts.

The probe comes after employees told CNNMoney that the practice of opening fake accounts began years earlier than Wells Fargo has previously acknowledged.

At the time it was announced, Stephen Sanger, the board's lead independent director, said Stumpf and another top bank executive could face further penalties, depending on the results of the investigation. On Wednesday, the person close to the matter said the board will continue its probe, and that Stumpf's retirement does not preclude further action against him.

Tim Sloan, Wells Fargo's president, will take over as chief executive, and lead director Stephen Sanger will take over Stumpf's other duties as chairman of the board.

Before Wells Fargo was engulfed in the fake account scandal, CEO Stumpf had been widely lauded as an everyday guy from middle America. He was one of 11 kids, and grew up getting his hands dirty working on his family's dairy farm in Minnesota.

"We had tough times, and we were poor, but we got through it because we were in it together," he told Fortune, adding that he shared a bed with two of his brothers until he was 18.

Stumpf was even named Morningstar's CEO of the Year in 2015. The company applauded him for "shunning activities that put profits ahead of customers" as most big banks did leading up to the 2008 financial crisis.

Despite Stumpf's retirement, activist group Public Citizen urged the Department of Justice to continue probing the Wells Fargo scandal.

"The retirement is essentially an admission of wrongdoing that only reinforces the need to continue tough criminal investigations" of Stumpf and other top executives, said Robert Weissman, president of Public Citizen.

Jaret Seiberg, a managing director at Cowen and Company, said his firm sees the executive shakeup as a "positive move," but notes the scandal is not over.

"We continue to expect that Wells Fargo will be bogged down in this controversy for the next two years," Cowen and Company said in a statement.

Wells Fargo shares were up 2% in after-hours trading.</s>SAN FRANCISCO — Wells Fargo’s embattled CEO John Stumpf has resigned, effective immediately, as the nation’s second-largest bank is roiled by a scandal over its sales practices.

The San Francisco bank said Wednesday that Stumpf will also relinquish his title as chairman. Its chief operating officer, Tim Sloan, will succeed Stumpf as CEO.

He faced congressional hearings and consumer wrath after Wells Fargo was found to have opened millions of bank accounts without customers’ permission.

Stephen Sanger, the bank’s lead director, will serve as the board’s non-executive chairman. Independent director Elizabeth Duke will serve as vice chair.</s>NEW YORK – Wells Fargo's embattled CEO John Stumpf is stepping down as the nation's second-largest bank is roiled by a scandal over its sales practices.

The San Francisco bank said Wednesday that Stumpf is retiring effective immediately and also relinquishing his title as chairman. It had earlier announced that Stumpf, the bank's CEO since 2007, will forfeit $41 million in stock awards.

Wells Fargo's chief operating officer, Tim Sloan, will succeed Stumpf as CEO and join the company's board. Sloan has been with Wells Fargo for 29 years. Stephen Sanger, the bank's lead director, will serve as the board's non-executive chairman.

Stumpf's end at Wells Fargo comes a little over a month after the bank was fined by California and federal regulators $185 million over its sales practices.

The regulators alleged employees trying to meet aggressive sales targets opened bank and credit card accounts, moved money between those accounts and even created fake email addresses to sign customers up for online banking – all without customer authorization. Debit cards were issued and activated, as well as PINs created, without customers' knowledge.

Stumpf, a 34-year veteran of the bank, had previously gained acclaim for navigating Wells Fargo through the financial crisis and keeping it free of scandal. But he came under withering pressure over the alleged misconduct, believed to have gone on at the bank for years. Some 5,300 lower-level employees were fired.

"While I have been deeply committed and focused on managing the company through this period, I have decided it is best for the company that I step aside," he said in a prepared statement Wednesday.

Among Stumpf's critics, Democratic Sen. Elizabeth Warren of Massachusetts told him at a Senate Banking Committee hearing last month that he should resign and "give back the money you took while the scam was going on."

Stumpf earned $19.3 million last year. But he and Carrie Tolstedt, the executive who ran the retail banking division, will forfeit millions.

Tolstedt announced in July that she would retire from the bank this year and had been expected to leave with as much as $125 million in salary, stock options and other compensation. She was stripped of $19 million of her stock awards, and her departure was made immediate.

Before the scandal, Stumpf was lauded for Wells Fargo having avoided some of the bad behavior of its peers in the lead-up to the financial crisis. Wells Fargo didn't invest in as many toxic mortgages as its counterparts, and Wells was actually able to grow significantly by buying Wachovia.

Until then a primarily West Coast and Southern bank, that gave the company known for its stagecoach logo access to the lucrative East Coast and New York banking markets.

The revelations have sparked investigations by federal agencies. The bank's independent directors have also launched their own investigation.

Wells Fargo is scheduled to report its quarterly results Friday morning. In after-hours trading, Wells Fargo shares added 88 cents, or nearly 2 percent, to $46.20.

Ken Sweet covers banking and consumer financial issues for The Associated Press. Follow him on Twitter at @kensweet</s>Wells Fargo’s embattled chief executive John Stumpf is stepping down as the US’s second-largest bank is dogged by a scandal over its sales practices.

The San Francisco bank said Mr Stumpf is retiring immediately and also relinquishing his title as chairman. It had earlier announced that Mr Stumpf, the bank’s chief executive since 2007, will forfeit $41 million in stock awards.

Wells Fargo’s chief operating officer Tim Sloan will succeed Mr Stumpf as chief executive and join the company’s board.

He has been with Wells Fargo for 29 years. Stephen Sanger, the bank’s lead director, will serve as the board’s non-executive chairman. Mr Stumpf’s end at Wells Fargo comes a little over a month after the bank was fined $185 million by Californian and federal regulators over its sales practices.

The regulators alleged employees trying to meet aggressive sales targets opened bank and credit card accounts, moved money between those accounts and even created fake email addresses to sign customers up for online banking — all without customer authorisation.

Debit cards were issued and activated, as well as PINs created, without customers’ knowledge. Mr Stumpf had previously gained acclaim for navigating Wells

Fargo through the financial crisis and keeping it free of scandal, but he came under withering pressure over the alleged misconduct, believed to have gone on at the bank for years.

About 5,300 lower-level employees were fired. “While I have been deeply committed and focused on managing the company through this period, I have decided it is best for the company that I step aside,” he said in a statement.

Democratic senator Elizabeth Warren told him at a Senate Banking Committee hearing last month that he should resign and “give back the money you took while the scam was going on”. Mr Stumpf earned $19.3 million last year, but he and Carrie Tolstedt, the executive who ran the retail banking division, will forfeit millions.

Ms Tolstedt announced in July that she would retire from the bank this year and had been expected to leave with as much as $125 million in salary, stock options and other compensation. She was stripped of $19 million of her stock awards, and her departure was made immediate. Before the scandal, Mr Stumpf was lauded for Wells Fargo having avoided some of the bad behaviour of its peers in the lead-up to the financial crisis. Wells Fargo did not invest in as many toxic mortgages as its counterparts, and Wells grew significantly by buying Wachovia.</s>BREAKING: Wells Fargo CEO John Stumpf to resign, effective immediately, in wake of scandal over bank’s sales practices.</s>NEW YORK (AP) — Wells Fargo’s embattled CEO John Stumpf is stepping down as the nation’s second-largest bank is roiled by a scandal over its sales practices.

The San Francisco bank said Stumpf is retiring effective immediately and also relinquishing his title as chairman. He won’t be receiving severance pay and the bank announced earlier that he will forfeit $41 million in stock awards.

Wells Fargo’s chief operating officer, Tim Sloan, will succeed Stumpf as CEO and join the company’s board. Sloan has been with Wells Fargo for 29 years. Stephen Sanger, the bank’s lead director, will serve as the board’s non-executive chairman.

Stumpf’s end at Wells Fargo comes a little over a month after the bank was fined by California and federal regulators $185 million over its sales practices.

The regulators alleged employees trying to meet aggressive sales targets opened bank and credit card accounts, moved money between those accounts and even created fake email addresses to sign customers up for online banking — all without customer authorization. Debit cards were issued and activated, as well as PINs created, without customers’ knowledge.

“I wish I could snap my fingers and make everything all right again, but it’s going to take time,” said Sloan said in an interview late Wednesday. “We are going to make it right by our customers and we are going to work to win that trust back.”

Stumpf, a 34-year veteran of the bank who took over as CEO in 2007, had previously gained acclaim for navigating Wells Fargo through the financial crisis and keeping it free of scandal. But he came under withering pressure over the alleged misconduct, believed to have gone on at the bank for years. Some 5,300 lower-level employees were fired.

“While I have been deeply committed and focused on managing the company through this period, I have decided it is best for the company that I step aside,” he said in a prepared statement Wednesday.

Among Stumpf’s critics, Democratic Sen. Elizabeth Warren of Massachusetts told him at a Senate Banking Committee hearing last month that he should resign and “give back the money you took while the scam was going on.”

News of Stumpf’s departure, however, did little to quell some lawmakers’ anger over the affair or their demands for information from the company on how harmed customers and employees will be made whole.

Senate Banking Committee Chairman Richard Shelby, R-Ala., and the panel’s senior Democrat, Sherrod Brown of Ohio, said Wednesday that Stumpf’s retirement doesn’t answer important questions.

“We are still waiting for answers as to how Wells Fargo plans to right its wrongs against customers and the low-paid employees who weren’t given the benefit of a retirement package when they were fired for refusing to cheat,” Brown said in a statement.

Stumpf earned $19.3 million last year. But he and Carrie Tolstedt, the executive who ran the retail banking division, will forfeit millions.

Tolstedt announced in July that she would retire from the bank this year and had been expected to leave with as much as $125 million in salary, stock options and other compensation. She was stripped of $19 million of her stock awards, and her departure was made immediate.

The revelations have sparked investigations by federal agencies. The bank’s independent directors have also launched their own investigation.

Wells Fargo is scheduled to report its quarterly results Friday morning. In after-hours trading, its stock rose 76 cents, or nearly 1.7 percent, to $46.08.

AP Business Writer Marcy Gordon contributed to this story from Washington.

Ken Sweet covers banking and consumer financial issues for The Associated Press. Follow him on Twitter at @kensweet</s>SAN FRANCISCO (dpa-AFX) - Wells Fargo & Co. (WFC) Wednesday said Chairman and Chief Executive Officer John Stumpf is retiring from the company and the Board, as the bank struggles to re-establish itself after the fake-account scandal.



The Board has elected Tim Sloan, the company's President and Chief Operating Officer, to succeed Stumpf. Stephen Sanger has been appointed as the Board's non-executive Chairman. Sloan will retain the title of President. 



Sanger said, 'Stumpf believes new leadership at this time is appropriate to guide Wells Fargo through its current challenges and take the Company forward. The Board of Directors has great confidence in Tim Sloan. He is a proven leader who knows Wells Fargo's operations deeply, holds the respect of its stakeholders, and is ready to lead the Company into the future.' 



Wells Fargo has been marred by a scandal after its retail banking segment employees opened up more than two million unauthorized bank and credit card accounts over the past five years and used those fake accounts to charge extra fees from customers. The bank fired around 5,300 employees for opening accounts without authorization. 



Stumpf testified two times before the Congress, while Wells Fargo has agreed to a $185 million settlement with regulators to settle the scandal.



Stumpf, a 34-year veteran of the company, joined Wells Fargo in 1982 as part of the former Norwest Bank, becoming Wells Fargo's CEO in June 2007 and its chairman in January 2010.



'I am also very optimistic about its future, because of our talented and caring team members and the goodwill the stagecoach continues to enjoy with tens of millions of customers,' Stumpf said.



WFC closed Wednesday's trading at $45.32, down $0.13 or 0.29%, on the NYSE. The stock, however, gained $0.71 or 1.57% in the after-hours trade.



Copyright RTT News/dpa-AFX</s>Wells Fargo & Co’s veteran chairman and chief executive officer, John Stumpf, is leaving the bank in the wake of a sales scandal and will be replaced as CEO by President and Chief Operating Officer Tim Sloan.

The San Francisco-based bank said on Wednesday that Stumpf was retiring with immediate effect. It is splitting the role of chairman and CEO with Stephen Sanger, its lead director, becoming chairman. Elizabeth Duke, an independent director, will be vice chair.

The changes come weeks after pressure on the bank when it emerged that its employees had potentially opened two million unauthorized deposit and credit card accounts to meet sales targets. Wells Fargo agreed to a $185-million settlement with regulators.

The scandal marked a stunning reversal of fortune for Stumpf, who had built Wells Fargo into the world’s most valuable bank with a focus on Main Street-style lending that was the envy of Wall Street.

Politicians were calling on him to resign and a week after a roasting in front of a Senate committee, Stumpf agreed to forgo $41-million in unvested stock awards.

However, that was not enough and at a second hearing, some lawmakers called for the bank to be broken up.

“I have decided it is best for the company that I step aside,” Stumpf said in a statement.

The bank’s shares rose 2 per cent in after-hours trading.

On Monday, the bank had reshuffled its top management to give more responsibility to Sloan.

Wells Fargo is due to report third-quarter earnings on Friday.
John Stumpf resigns as CEO and chairman of Wells Fargo amid a scandal over its sales practices.