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Wells Fargo Likely to Clawback Carrie Tolstedt’s Stock Options

March 17, 2017

Carrie Tolstedt, the former chief of consumer banking for Wells Fargo, retired last July after 27 years with the bank. In the process, she took home $125 million in stock, options and restricted Wells Fargo shares – some of which had not yet vested. At the time, there was no mention of a ‘clawback’ to any of the stock and cash compensation had been awarded. But that appears that will be changing.


The Wells Fargo Board of Directors is expected to clawback the entire lot of stock options that Ms. Tolstedt had been awarded - valued at nearly $54 million in today’s market. No comment was available from either Wells Fargo or Ms. Tolstedt's counsel.


It isn't clear whether Ms. Tolstedt was responsible for, or even aware of, the widespread abusive tactics that took place in the Community Banking division of the bank that she ran during the entire period in which the customer abuse was alleged. That division includes retail banking and credit card divisions. Rather, througout that period, Ms. Tolstedt was regularly praised for her unit's ability to get customers to open numerous accounts. And, for a number of years, the Wells Fargo's proxy statement, which details executive pay, cited high "cross-selling ratios" as a reason that Tolstedt had earned her roughly $9 million in annual pay. 


Too good to be coincidental?