The former president of Wells Fargo’s retail bank pleaded guilty Friday to obstruction charges in connection with the bank’s massive fake account scandal, avoiding a prison sentence.
Carrie Tolsted was sentenced by U.S. District Judge Josephine Staton in Los Angeles to three years’ probation, including six months of home confinement. She will also pay a $100,000 fine and perform 120 hours of community service.
Mr. Tolsted, 63, pleaded guilty in March to obstructing a government investigation into fraud at San Francisco-based Wells Fargo’s retail and small business lending business, which he led from 2007 to 2016. .
She was a detective in a 2016 revelation about Wells Fargo’s sales culture, where employees opened millions of accounts to meet unrealistic sales goals and sold products customers didn’t want. He is the only executive to face charges.
Mr. Tolsted is also the rare top executive at a major U.S. bank who could face a prison sentence. Not a single person went to prison as a result of the 2008 global financial crisis.
Prosecutors had asked for a one-year prison term for Mr. Tolsted, but the judge said that would unfairly make Mr. Tolsted appear solely responsible for Wells Fargo’s fraud.
The actual sentence reflected Tolstedt’s request, in which she accepted “full responsibility” for her crimes.
Mr. Tolstedt’s lawyer declined to comment. U.S. Attorney Martin Estrada’s office in Los Angeles had no immediate comment.
Wells Fargo paid $3 billion in 2020 to settle federal criminal and civil investigations into its sales practices, admitting that it pressured employees to sell more products for more than 15 years, known as cross-selling. Ta.
The scandal also ousted former CEO John Stumpf, who paid a $17.5 million civil penalty in 2020 and accepted a lifetime ban from the industry, and led to the Federal Reserve’s decision in 2018 to oust former CEO John Stumpf from Wells. It led to capping Fargo’s assets and limiting the bank’s growth.
Wells Fargo remains the fourth largest bank in the United States, but the cap remains in place.
Mr. Tolstedt, once called “America’s best banker” by Mr. Stumpf, also accepted an industry ban and will pay a $20 million civil penalty to resolve charges by the Office of the Comptroller of the Currency and the Securities and Exchange Commission. Agreed.
Wells Fargo also recovered tens of millions of dollars of her salary.
