Wells Fargo to Pay New York $65M Over Cross-Selling

According to an email from June 2011 reviewed and shared by New York regulators, a member of the bank's incentive compensation team said: "I've asked bankers … why people cheat … it's because their manager tells them they'll be fired if they don't hit their minimums."

"We are pleased to reach this agreement," the bank said in a statement. "Wells Fargo did not admit liability, and we believe that putting this matter behind us is in the best interest of all of our stakeholders, including customers. The settlement costs have been previously accrued."

In January, Wells Fargo said it was setting aside $3.25 billion reserve to cover litigation related to fake accounts and other issues. That followed  a $1 billion charge in the third quarter for a potential settlement with regulators over pre-crisis mortgage sales.

The Attorney General's office says it continues to investigate Wells Fargo in connection with the opening of "millions of unauthorized accounts and enrolling consumers in services without their knowledge or consent."

Recent Results

In the third quarter, Wells Fargo's wealth management unit — which accounts for 12% of the bank's total net income — had 2% uptick in profit from the prior year to $732 billion.

That represented a big change from the second quarter, when net income sank 37% from the prior year and the unit set $114 million aside for refunds to wealth management clients who were charged "incorrect fees."

The number of financial advisors in the retail brokerage business, though, fell again. It stands at 14,074 — down 490 from a year ago and 152 from the second quarter.

Since Wells Fargo's fake-accounts scandal began capturing headlines in September 2016, the number of advisors has declined by 1,012 — a drop of 7% from 15,086 two years ago. The trend seems to be continuing into the fourth quarter.