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Wells Fargo CEO tells employees to brace for more negative headlines

Key Points
  • Wells Fargo CEO Timothy Sloan said Tuesday the bank will announce "within a few weeks" the completion of an expanded third-party review of its consumer sales scandal.
  • The results will "generate news headlines," Sloan said, and the "best thing" for the bank to do is to "stay focused on fixing problems."
  • The bank said it has already paid out more than $5 million to customers and faces a total of a few hundred million in related settlements.
Tim Sloan, Chief Executive Officer of Wells Fargo & Company, February 8, 2017.
Lucas Jackson | Reuters

Wells Fargo CEO Timothy Sloan said Tuesday that forthcoming results from the bank's review of its consumer sales scandal could cause more negative attention.

"The results of our reviews will generate news headlines, but even as we face this renewed coverage, the best thing we can do is stay focused on fixing problems, making things right for customers, and building a better, stronger Wells Fargo," Sloan said in a company-wide message that was shared in a press release.

Sloan also said that "within a few weeks" the bank will announce the completion of an expanded review by a third party of the fake consumer accounts workers had opened. They were pressured by aggressive sales goals, a practice Wells Fargo has since ended.

In an Aug. 4 quarterly 10-Q filing required by the SEC for public firms, Wells Fargo said it expanded the review period to 2009 through 2016 and that could reveal a "significant increase" in unauthorized accounts.

"This analysis examined account usage patterns and is constructed to err on the side of the customer in determining which accounts are included as potentially unauthorized," Sloan said Tuesday.

The bank will also send notices about the process for customers to make claims against the bank and is compiling a list of additional customers who complained an account was opened without their consent, Sloan said in the memo.

The bank has now paid more than $5 million in total customer refunds or payments, the release said.

Sloan took over Wells Fargo last fall after it was discovered the bank's workers had opened about 2 million consumer deposit and credit card accounts without customers' authorization since 2011. Wells Fargo paid $185 million in penalties.

This year, the bank also reached a preliminary class-action settlement of $142 million over concerns about retail sales practices and unauthorized accounts from 2002.

Wells Fargo shares were little changed in after-hours trade but are down 5 percent so far in 2017, trailing the Financial Select Sector SPDR, which is up nearly 7 percent year to date.

In a statement to CNBC, Wells Fargo spokeswoman Mary Eshet referred to the Aug. 4 10-Q filing.

"The team news [press release] shared the things we have done and are doing to make things right for customers," she said, "and reminded team members that if the results of the review result in news stories, the best thing for team members to do is stay focused on customers."

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