How many whistleblowers did the Feds ignore? In the Wells Fargo case about 700.

How many whistleblowers did the Feds ignore? In the Wells Fargo case about 700.

File photo taken in 2010 shows a Wells Fargo sign outside a bank branch in Palo Alto, Calif.

Most tellingly, bank examiners assigned to review Wells Fargo were aware of approximately 700 whistleblower complaints related to "gaming of incentive plans" when they met with senior managers of the San Francisco-based bank in January 2010, the report said.

Carrie Tolstedt, who at the time headed the community banking division that was ground zero for the scandal was dismissive of the complaints, attributing them to a corporate culture that encouraged valid claims "which are then investigated and appropriately addressed," the report said. Tolstedt also said the bank's sales incentive programs were capped at 10% to 20% of bank workers' total compensation "to keep motivation in check." Tolstedt no longer works for the bank and has had to give back millions in compensation in connection with her role in the scandal.

According to the report, there was "no evidence that examiners required the bank to provide an analysis of the risks and controls, or investigated these issues further to identify the root cause and the appropriate supervisory actions needed."

Additionally, Wells Fargo's board of directors received regular reports dating back to 2005 indicating that the highest volume of internal ethics complaints at the bank involved "sales integrity violations." The OCC's Wells Fargo team received the same reports as early as 2010. However, the report said records don't "indicate examiners investigated the root cause."

Recommending tighter OCC scrutiny, the report said the Wells Fargo oversight fiasco provided "meaningful lessons learned" about the importance of comprehensive analysis of complaints by bank employees and whistleblowers, as well as proper supervision of "controls around high-risk incentives."



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