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Despite pointed attacks from Democrats, Wells Fargo & Co. CEO Timothy Sloan tried to tell a Senate banking panel Tuesday about the “fundamental changes” the bank is making to address past misconduct.

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Sue Reisinger

Senior reporter at ALM since 2004; based in Florida; covers general counsel and white collar crime; contact: sreisinger@alm.com

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<p>Despite pointed attacks from Democrats, Wells Fargo & Co. CEO Timothy Sloan tried to tell a&amp;nbsp;<a href="https://www.banking.senate.gov/public/index.cfm/home" rel="nofollow">Senate banking panel</a>&amp;nbsp;Tuesday about the &ldquo;fundamental changes&rdquo; the bank is making to address past misconduct.</p><p>With his new general counsel,&amp;nbsp;<a href="https://www.wellsfargo.com/about/corporate/governance/parker/" rel="nofollow">Allen Parker</a>, sitting behind him, Sloan took the hot seat for nearly two hours at a hearing of the U.S. Senate&rsquo;s Banking, Housing, and Urban Affairs Committee. He began with an apology for the fake bank account scandal that was revealed one year ago.</p><p>&ldquo;Let me be very clear about this: I am deeply sorry for letting down our customers and team members,&rdquo; Sloan said. &ldquo;I apologize for the damage done to all the people who work and bank at [Wells Fargo].&rdquo;</p><p>But Sloan&rsquo;s words were was not enough for Democrats on the panel, especially U.S. Senator Elizabeth Warren, D-MA, who called for Sloan&rsquo;s ouster from Wells Fargo. Warren also called on regulators to replace those directors who were on the bank&rsquo;s board during the fake account scandal.&amp;nbsp;</p><p>Warren noted that Sloan was chief financial officer at the time of the scandal and has been at Wells Fargo some 30 years and should have been able to act before this.</p><p>&ldquo;At best you are incompetent. At worst you were complicit. At the least, you should be fired,&rdquo; she said.</p><p>Sen. Brian Schatz, D-Hawaii, went further, demanding to know why regulators shouldn&rsquo;t revoke Wells Fargo&rsquo;s banking charter. Other Democrats attacked the bank&rsquo;s culture, its leadership and Sloan&rsquo;s&amp;nbsp;<a href="http://www.nationallawjournal.com/id=1202799524661" rel="nofollow">refusal to rule out using forced arbitration with customers</a>.</p><p>For his part Sloan emphasized the changes being made at the bank, including hiring a new chief compliance officer. The bank told Corporate Counsel that Wells Fargo is in the process of getting a new CCO, but has not made the hire yet.</p><p>In June, Yvette Hollingsworth, who served as the bank&rsquo;s chief compliance officer for the past five years, was named executive vice president and regulatory innovation officer to deal with new banking technology and risk.</p><p>At the hearing, Sloan made three key points:</p><ul><li>&amp;nbsp;The retail banking system at Wells Fargo has new leadership that is incentivizing employees for doing what is right for the customer, not just for selling products or setting up fake accounts.</li><li>The bank is doing an ongoing review of operations across the entire company, including its auto lending business. It was recently revealed that Wells Fargo had charged some 570,000 auto loan customers with car insurance policies without their knowing it, and without checking to see if they had auto insurance already.</li><li>The bank has pledged to compensate &ldquo;every customer who suffered because Wells Fargo made mistakes.&rdquo;</li></ul> <

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