Wells Fargo faces criminal probe over interview practices: Report

Federal prosecutors have started probing Wells Fargo’s hiring procedures after a report about “fake interviews” the company held for nonwhite and female job applicants, according to The New York Times.

The civil rights unit at the U.S. attorney’s office in Manhattan is spearheading a criminal investigation, the Times reported Thursday afternoon, citing two unnamed people familiar with the development.

The investigation follows a report last month from the Times, which alleged that seven current and former employees at Wells Fargo’s wealth management unit were told to interview “diverse” candidates for positions that managers had already promised to others. The purpose of those directives appeared to be improving the megabank’s statistics on interviewing diverse candidates, the Times reported.

Bloomberg

Wells Fargo CEO Charlie Scharf told employees earlier in the week that the bank was suspending its “diverse slate” policy, which required at least half of candidates for roles that paid at least $100,000 to be “diverse,” the Times has reported. The policy had previously been in place informally but was codified in mid-2020 as executives focused on improving diversity at the bank.

In a statement Thursday, Wells Fargo said that “no one should be put through an interview without a real chance of receiving an offer, period.” It also said its diverse slate policy has led to “meaningful results in our hiring data” since 2020, saying about 38% of its outside executive hires were racially or ethnically diverse in 2021, compared with 25% in 2020.

But Wells also said it is temporarily pausing the guidelines as executives look to ensure they are implemented consistently.

“During this pause, the company is conducting a review so that hiring managers, senior leaders and recruiters fully understand how the guidelines should be implemented — and so we can have confidence that our guidelines live up to their promise,” the company said.

In its latest article, the Times reported that since its original story, 10 more employees have shared similar accounts regarding job interviews.

Consumer banking

Wells Fargo employees feared for their jobs, consumer banking head says

Mary Mack testified last week about the cultural problems she encountered after joining the bank's consumer unit in 2016. Recalling small group meetings she held with employees, she said: "People would stand up, and they were fearful."

By Kevin Wack

November 1

The Times’ article Thursday included an interview with Wells Fargo’s head of human resources, Bei Ling, who said she did not think there was a “systematic issue” and that the company had not heard complaints from employees.

“During these past eight months I can tell you I have never heard such a thing from the recruiting community,” Ling, who joined the bank last year, told the Times. “I have never even heard the words ‘fake interview.’”

The diversity imbroglio is only the latest controversy for the San Francisco bank, which remains under several regulatory consent orders tied to its fake-accounts scandal in 2016. Wells also has drawn scrutiny over a Bloomberg News report finding that it approved fewer than half of all Black applicants who sought to refinance their mortgages in 2020. Kleber Santos, the bank’s head of diverse segments, representation & inclusion, has said the report was “oversimplified.”

Sen. Sherrod Brown, an Ohio Democrat who chairs the Senate Banking Committee, wrote to Scharf last month asking him to “once and for all address Wells Fargo’s governance, risk management, and hiring practices — weaknesses that have plagued the bank for almost a decade.”