Wells Fargo’s board is likely to scrap annual 2016 bonuses for some top leaders amid fallout from the company’s fake-accounts scandal, a person familiar with the matter said Wednesday.
The San Francisco-based bank’s directors discussed the issue at a meeting in January, but haven’t finalized their decision, the person said. This is the time of year when banks determine year-end bonuses and prepare spring proxy filings that disclose pay for top executives.
The Wall Street Journal reported the potential for the lost bonuses earlier on Wednesday. A Wells Fargo spokesman declined to comment.
In September, Wells agreed to pay regulators $185 million in fines to settle allegations that its employees may have opened as many as 2 million unauthorized accounts to meet aggressive sales goals. The scandal has led to a bevy of investigations and cost CEO John Stumpf his job.
Wells Fargo’s board is pursuing its own investigation. The board is expected to compete the probe in coming months and could release preliminary results earlier, the person said.
Taking away bonuses for top executives would not signal culpability for specific wrongdoing but show broader accountability in the wake of a scandal that has diminished retail branch sales and besmirched the image of a company that had fared well in the financial crisis, the person said.
Top executives that could be in line to lose compensation are CEO Tim Sloan and Chief Financial Officer John Shrewsberry. Sloan was elevated from president and chief operating officer in October and has been working to restore trust in the company.
In 2015, Sloan received total compensation of $11 million, including a $1 million bonus and $8 million in stock awards.
Wells Fargo, which has major Charlotte operations, last month posted a fourth-quarter profit that was down 5 percent as the bank continued to grapple with the scandal. The bank will report first-quarter results in April and executives and directors will also have to face investors that month at the bank’s annual shareholder meeting.