Wells Fargo Shares Dive After 10Q Reveals Potential For "Significantly" More Fake Accounts

Tyler Durden's picture

Wells Fargo just released a lengthy 10Q revealing a number of concerns for shareholders with regard higher-than-expected legal costs, new auto loan sales 'issues', and the potential for "significantly" more fake accounts based on a wider review. Ironically, WFC's CEO Tim Sloan began his press release thus... "rebuilding trust became our top priority when I became CEO last October."

Headlines from the 10Q (via Bloomberg)

  • *WELLS FARGO SEES POSSIBLE LEGAL COSTS BEYOND RESERVES OF $3.3B
  • *WELLS FARGO SAYS CFPB INVESTIGATING FREEZING OF CLIENT ACCOUNTS
  • *WELLS FARGO TO INCREASE BOGUS ACCOUNTS REVIEW BY 3+ YEARS
  • *WELLS FARGO:WIDER EXAM MAY FIND `SIGNIFICANTLY' MORE FAKE ACCTS
  • *WELLS FARGO `ANTICIPATES' IDENTIFYING, REMEDIATING AUTO ISSUES
  • *WELLS FARGO SAYS AUTO REVIEW MAY INCLUDE ORIGINATION, SERVICING
  • *WELLS FARGO:AUTO INSURANCE ISSUE MAY RESULT IN REGULATOR PROBES
  • *WELLS FARGO SAYS IT DISCLOSED CLIENT DATA LEAK TO AGENCIES

"We expect that our review of the expanded time periods, which adds over three years to the initial review period of approximately four years (May 2011 to mid-2015), and our review and validation efforts for the initial review period, may lead to a significant increase in the identified number of potentially unauthorized accounts.

 

However, we do not expect any incremental customer remediation costs as a result of these efforts to have a significant financial impact on the Company."

And the result...

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SloMoe's picture

Need more de-regulation. That'll fix it.

lo2hi's picture

all WFC bad shit under obama, for the record.

SloMoe's picture

One swamp, to rule us all...

jcaz's picture

But.... But.... Uncle Warren blessed the management staff of WF personally........

NoVa's picture

I worked at Norwest in Des Moines back in the mid '90s. Kovachivich days before Norwest took over Wells Fargo (er, "merged").  Pushing products was cultural back to the '80s!

Back then Cross-Selling products was encouraged and they compensated management on "Soft-Dollar Credits".  recorded in the General Ledger but the GL accounts used were outside of the real GAAP ledger which was given to regulators and used for SEC results. 

Hence, outsiders never saw the soft $$ credits but internal management saw soft $$ on their P&Ls. 

NotApplicable's picture

Funny, I warned my daughter not 30 minutes ago to stay away from WF while shopping for a mortgage.

NoVa's picture

er, Not Funny.

I suspect it has now stopped.  Dodd-Frank & CFPB has pretty much commoditized mortgages - tell her to shop around and show quotes to other lenders to "beat this rate & fees". 

Mortgage industry is starting to show signs of bleeding, with some firms facing going out of business.  I'm CFO of a large lender. 

 

NoVa

pickupthatcan's picture

WF held my mortgage when I sold the house in '11. They had all my forwarding info. Account closed and cleared. Last month I checked my state's abandoned property website. Wells Fargo had $4200 of mine for the last six years and never disclosed it until they turned it over to the state two months ago.

I wonder how much they make on all the other monies they keep over the years?

SethPoor's picture

Fake accounts? It is ALL fake !

Never One Roach's picture

Better bring Mozillo in to straighten out the books.....

Rubbish's picture

Dinner is served, tonights entree, cooked books by every major corporation in America.

 

200 PEes for dessert.

 

Gold Bitchez..... I pick up pennies

techpriest's picture

Need more de-regulation. That'll fix it.

Yes, it would.

In particular, these frauds can go out of business, not be bailed out, and we can watch the credibility of big bank promoters evaporate.

For that matter, we could start a Bank of ZH if we wanted to, aside from the "bank" you lost in a boating accident of course.

silverer's picture

Banks have to understand their business is broken because the people they do business with are broken. It won't get better.

jmack's picture

Clintonesque drip drip drip

Pausebreak's picture

Wasn't Dodd-Frank legislation suppose to stop this predatory banking behavior?

WillyGroper's picture

no.

it was to destroy any & all competition...regionals, cu's.

chunga's picture

I blame millennials and the minimum wage being too high.

Dode415's picture

Wonder what the other leeches in the other banks are hiding - if one's been doing it you can be sure they've all been at it

JRev's picture

They're all doing it - even non-bank entities like PayPal and AMEX, and it's all about drug and arms money laundering. HSBC whistleblower John Cruz broke this story a long time ago: 

https://www.youtube.com/watch?v=R5Y4UGPQTLg

pliny the longer's picture

we're all so F'ing outraged about all this that . . .  well . . .  nothing's going to change and nobody's going to jail, dammit!!! 

Doom Porn Star's picture

ENOUGH FRAUD AND THIEVERY.

PULL THE GOD DAMNED BANK CHARTER.

BREAK UP A TBTF & SEND A FEW HUNDERED PEOPLE TO PRISOIN AND THIS SHIT MIGHT STOP.

Too-Big-to-Bail's picture

Someone or some algo bought the dip, LOL

Calculus99's picture

I love it, the review 'may' find significantly more fake accounts. 

That's like saying the Sun 'may' rise in the East tomorrow morning. 

the not so mighty maximiza's picture

Wells sent me a pre approval letter for a 150,000 corp loan.  they are swell guys, i dont even need 150,000 dollars but they thought of me anyway

barysenter's picture

I get those. It's ring bait & switch haka to get their claws into your business. 

Anon2017's picture

A rather deceptive chart. WFC is currently down less than 1 point from yesterday's close. 

Chryoprase the Troll's picture

Indeed. It's easy to make charts look dramatic when the x or y axis is scaled or offset. Somebody clearly BTFD. Probably nothing.

wet_nurse's picture

Can't the police just go there and confiscate their money if they suspect it was earned from crime? Maybe that's why Sessions reinstated that practice.

JRev's picture

The "fake" accounts at all major commercial banks are for laundering Intelligence drug money. .gov takes a sizable percentage. This is per HSBC whistleblower John Cruz and was publicized well before the Wells Fargo "shadow account" story broke: 

https://www.youtube.com/watch?v=R5Y4UGPQTLg

Sessions is a wet blanket. A soup sandwich. He'll bust the "competition" (darknet markets) but will never go after the true cash cow.

The_Central_Scrutinizer's picture

Why does this entity still have legal standing to operate BAU? Why does it have any retail customers at this point?

PhiBetaZappa's picture

No worries WF, the permanetly bent over taxpayers have these little msihaps covered.

Party on.

 

Snaffew's picture

true that...maybe they will be hiring 1,000 new positions with all this great jobs data.  I'm signing up for a WF personal loan for about $500k....I'll just take the stance of homeowners that can't pay the mrtgage on their mcmansions and ride it out.  Oh, i forgot---banks aren't giving out loans.

barysenter's picture

Must be all those immigrants and quotas the Criminal Banks fasttracked to meet their despotic agenda. Excellent! B of A is going down too!

pparalegal's picture

In California they gladly open checking accounts and give loans to illegals. Not straight up, but they advise how to get'er done if you know one legal human.

insanelysane's picture

1. Who still has a bank account with this bank?

2. How can there be any real accounts?  Fake accounts became standard operating procedure.  I would be surprised to find employees that know how to create an actual account on their computer system.  That function is most likely hidden.

3. This is why we haven't heard from VW about a fix for their diesel engines.  Once the cheating software became sucessful there was no need to pay diesel engineers.  VW doesn't have anyone to figure out how to fix the issue.  Neither does Wells Fargo.

Joebloinvestor's picture

I think you mean,"Who still has stock in this bank?".

 

Accounts are fed insured.

GRDguy's picture

Warren Buffett: The top stock holder, as of 3/31/2017, 479,704,270 shares worrth $26,700,340,000.

6/30/2017 numbers available in a week or two.

NotBuyingIt's picture

My Libtard (ex-"school teacher") neighbor still banks with these criminals. Even though she KNOWS all about the fraud, AND she has plenty of other options (local banks, credit unions).

Sometimes, stupid just cannot be explained. She deserves everything she gets from these scumbags.

StreetObserver's picture

We heard about a guy that got a Wells Fargo trifecta, they screwed him on his mortgage and he lost his house, they forced him to buy car insurance and deducted it from his monthly car payments, even though he was insured through a another insurance company and the messed with his credit.

His reaction? He swears he'll buy can of spray window foam and hit every Wells Fargo ATM card slot until they either go bankrupt or change the technology. Short term profits breed long term resentments.

Stormtrooper's picture

How much will this bailout cost American taxpayers?  We know it's coming.

TheObsoleteMan's picture

Why should anyone be surprised by any of this? When you are too big to fail, and are above the law, you can do as you damn well please. There are no costs for your actions.

Eddielaidler's picture

Wonder if they would give me a streamline mortgage without any overlays?

hidflect's picture

They already have. Well, it's taken out in your name and handed to a Chinese investor who pays back in cash deposits but nobody gets hurt and that's the main thing...

Grumpy_nl's picture

Wells Fargo, the bank orginized like the mob.

Don in Odessa's picture

Why any ordinary citzen or honest company continues to do business with this crimminal entitity is beyond me.