Banking

Wells Fargo hopes its new office will help the bank move on from its scandals

Bank of America and Wells Fargo are on different paths. What does it mean for Charlotte?

Bank of America and Wells Fargo, are the two biggest banks in Charlotte. However, the two banks are completely different.
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Bank of America and Wells Fargo, are the two biggest banks in Charlotte. However, the two banks are completely different.

Wells Fargo said it has created an office that will be led by a Charlotte-based executive, as part of the scandal-plagued bank’s efforts to fix its problems and satisfy federal regulators.

Derek Flowers, a 21-year company veteran, will head the Strategic Execution and Operations Office, the San Francisco-based bank announced late Friday. Flowers will report to interim CEO Allen Parker, according to the bank.

The office’s creation comes as Wells continues working to turn itself around following stunning revelations in 2016 that employees had opened as many as 3.5 million accounts without customer permission to meet high-pressure sales goals.

Since that scandal, Wells has disclosed instances of customer harm in other parts of its business.

The bank remains under orders issued by regulators, including the Office of the Comptroller of the Currency, who have told it to fix deficiencies in areas such as risk management. One of those orders, issued last year by the Federal Reserve in response to “widespread consumer abuses” at Wells, places an unprecedented cap on the bank’s growth.

In a press release, Wells said it hopes the new office will allow it to do a better job of meeting regulatory mandates as well as helping the bank continue to transform and improve.

“The formation of the Strategic Execution and Operations Office is an important step in Wells Fargo’s work to meet the expectations of our regulators, do the right thing for our customers and team members, and move our company forward,” Parker said in a statement.

Parker has served in his role since Tim Sloan abruptly stepped down in March after being promoted to head Wells in the wake of the 2016 scandal.

In announcing his departure, Sloan said the focus on him had become a distraction that was impacting efforts to move Wells forward. Wells’ board has said it plans to look outside the company for its next CEO.

Previously, Flowers was chief credit and market risk officer at Wells. In that role, he as responsible for leadership and oversight of all credit, counterparty and market risk at Wells.

Wells Fargo’s largest employment hub is in Charlotte, where it has approximately 26,000 workers.

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Deon Roberts has covered Charlotte’s financial services industry for The Charlotte Observer since 2013. His beat includes Bank of America and Wells Fargo. He attended Loyola University in New Orleans and is a native of Lafitte, La.
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