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Lawmakers Seek Answers on Wells Fargo’s Overdraft Fees Revenue
On Wednesday, January 11, 2017, seven Senate Banking Committee Democrats, led by Ranking Member Sherrod Brown (D-OH) and Sen. Senator Elizabeth Warren (D-MA), sent a letter to CEO of Wells Fargo, Timothy Sloan, expressing concern and asking for more information regarding the bank’s increase in overdraft fee income. “We read with great concern a Financial Times report indicating Wells Fargo’s income from overdraft fees increased at a rate five times higher than the company’s banking industry peers,” the letter stated. “It would be particularly distressing if Wells Fargo were pursuing an increase in revenue from overdraft fees to compensate for the bank losing customers as a result of the fake accounts scandal.”
The Senators requested Wells Fargo respond to eight specific questions regarding the bank’s overdraft fees by February 14, 2017. Specifically, they requested information related to sales goals of overdraft protection products, a breakdown of monthly income Wells Fargo receives from overdraft fees, any policy changes the bank has made with respect to fees, income derived from “free checking” accounts, the number of customers signed up for overdraft programs without their express consent, the number of employees that received increased compensation for meeting sales goals related to overdraft, whether the increase in overdraft income is consistent with the bank’s stated priority to “take care of customers,” and any other information to explain the growth in overdraft revenue.