Wells Fargo - Just Can't Keep Their Heads Down
"With all due respect, I'm against dumb." - Senator Neely Kennedy (Rep.) at the October 3rd Wells Fargo Testimony (grilling) before Congress.
You would think that after being berated by members of Congress, being banned from growing by the Federal Reserve and still waiting for the results of ongoing serious investigations into the firm's business practices a company and its CEO, would just want to keep its head down and stay out of the news. Indeed on Friday, it was announced that the Justice Department’s investigation of the bank has been broadened to include the bank's wealth-management division.
In keeping with what would appear to be the firm’s "dumb" strategy, the Wells Fargo Board has chosen to increase the CEO's total compensation in excess of 30%! This while the bank is under an ever-expanding Federal investigation and a Federal Reserve growth ban.
At the company’s last annual meeting both us, and others recommend "withhold" votes from a number of Board members, however, major shareholder Berkshire Hathaway along with a few other key shareholders decided to support to directors preventing the vote from reaching a percentage where they would be forced to resign.
Unfortunately, it doesn’t look like the Wells Fargo Board is going to be any easier to recommend "for" the Board this year then it was last year.