Senior Wells Fargo exec: No FBI interviews here

Memo denies Journal's claim that the FBI interviewed employees in the bank's wealth management group

Mar 19, 2018 @ 12:41 pm

By Bruce Kelly

A senior Wells Fargo & Co. executive Monday morning contradicted a report from last week in the Wall Street Journal that the FBI had recently interviewed employees in the bank's sprawling wealth management group, home to some 14,544 brokers and advisers.

In an internal memo to financial advisers, Jonathan Weiss, a senior vice president in Wealth and Investment Management, said that — after the Journal's report Friday that the FBI had interviewed some employees in Phoenix — the bank reviewed the matter internally and discussed it with its law firm, Shearman & Sterling.

The bank's board had recently hired the law firm in connection with an independent review of the Wealth and Investment Management group, known as WIM internally. The Justice Department recently instructed the bank to conduct an investigation of its WIM business. Wells Fargo Advisors operates as a part of WIM.

Mr. Weiss denied any FBI interviews with Wells Fargo WIM employees.

"As a result of that review and discussion, we are confident none of our team members in Wealth and Investment Management was interviewed by the FBI, as described by the Wall Street Journal," according to the memo, which was signed by Mr. Weiss. "We have learned some interviews did occur recently in Phoenix, but there were conducted solely by Shearman & Sterling as part of its independent review."

"We all appreciate how difficult it is to take questions from clients and team members in the environment of heightened media scrutiny," Mr. Weiss added.

The bank's internal investigation is looking at whether "there have been inappropriate referrals or recommendations, including with respect to rollovers for 401(k) plan participants, certain alternative investments, or referrals of brokerage customers to the company's investment and fiduciary services business," according to a company filing with the Securities and Exchange Commission from the start of the month.

"We stand by our reporting," a Wall Street Journal spokesman, Steve Severinghaus, said when contacted about the Wells Fargo memo.

A spokeswoman for Wells Fargo, Emily Acquisto, confirmed that the company sent the memo denying any FBI interviews of wealth management employees, but declined to comment further.

Earlier this month, Massachusetts Secretary of the Commonwealth William Galvin also opened an investigation of Wells Fargo Advisors, targeting whether the firm inappropriately moved investors into higher-fee accounts.

A scandal in Wells Fargo's retail banking unit that came to light in September 2016 resulted in the company being fined $185 million for opening banking accounts for a few million customers without their knowledge or approval.

The bank also was scrutinized last year for its auto-loan practices, which led to hundreds of thousands of clients who had taken out car loans being charged for insurance they didn't need.

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