Washington, D.C. – Earlier this week, two former Wells Fargo board members resigned after a scathing report blamed the board of directors for its oversight failure that helped allow the bank to defraud potentially millions of consumers. This shouldn’t be a surprise — the majority of the board members from that time period are no longer serving on the bank’s board. In fact, most of them were ousted or resigned in disgrace following a series of scandals.

But Elaine Chao, who served on the Wells Fargo Board of Directors from 2011 until 2017, got a very cushy landing when she was confirmed as transportation secretary.

Most of Chao’s fellow board members from her final year weren’t so lucky:

• Two members, Elizabeth Duke and James Quigley, left their positions in March 2020, just days before they were set to testify about the scandal to Congress.

• One member, John Stumpf, was personally fined $17.5 million by the Office of the Comptroller of the Currency, and barred from working in the banking industry again.

• Three members, Cynthia Milligan, Stephen Sanger, and Susan Swenson, left the board at the end of 2017 in a move widely reported as a cleaning up of the board.

• Four members, John Chen, Lloyd Dean, Enrique Hernandez, Jr., and Federico Peña, left the board in March 2018 in what was reported as a deal with the Federal Reserve following the scandal.

• One, Susan Engel, chose not to stand for reelection in the immediate aftermath of the scandal, retiring in 2017.

“While an overwhelming majority of directors on Wells Fargo’s board have either been ousted or resigned in disgrace after the bank defrauded potentially millions of innocent people during their tenure, former director Elaine Chao was promoted by Trump  into a top taxpayer-funded administration job,” said Lizzy Price, director of Restore Public Trust. “Chao continues to earn money from Wells Fargo while the bank’s victims are still struggling to recover. Americans deserve to know the extent to which Secretary Chao and her fellow board members knew and approved of these consumer abuses. Congress must call on Chao to testify now about her role in letting massive corporate fraud and abuse unfold on her watch.”

WHAT YOU NEED TO KNOW:

2016: Wells Fargo Had 15 Members On Its Board Of Directors During Elaine Chao’s Final Full Year, Three Of Which Still Remain At The Company

Of The 15 Wells Fargo Board Members In 2016, Only Three Remain With The Company

John Baker II, Donald James, And Suzanne Vautrinot Served With Chao On The Wells Fargo Board. Baker and James served from 2011 to 2016; Vautrinot arrived in 2015 and 2016. [Wells Fargo & Company Annual Report 2011, 2011; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/15/12; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, Wells Fargo, 3/14/13; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/18/14; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/17/15; Wells Fargo & Company Notice of Annual Meeting of Stockholders, Wells Fargo, 4/26/16]

March 2020: John Baker II Was Still At Wells Fargo As The Executive Chairman. “Mr. Baker is currently executive chairman and, since March 2017,  chief executive officer of FRP Holdings, Inc. (successor to Patriot Transportation Holding, Inc.), a real estate company located in Jacksonville, Florida. From February 2008 until October 2010, he served as the president and chief executive officer of Patriot. “ [Wells Fargo – “John D Baker II,” accessed 3/9/20]

March 2020: Suzanne Vautrinot Continued To Serve On The Wells Fargo Board. “Ms. Vautrinot is currently President of Kilovolt Consulting, Inc., a cyber security strategy and technology consulting firm.  […] Wells Fargo Board Committees: Corporate Responsibility Committee, Credit Committee, and Risk Committee” [Wells Fargo – “Suzanne M. Vautrinot,” accessed 3/9/20]

March 2020: Donald James Was Still On The Board Of Directors At Wells Fargo. “Mr. James is the retired Chairman and CEO of Vulcan Materials Company, a construction materials company located in Birmingham, Alabama. […] Wells Fargo Board Committees: Finance Committee, Governance and Nominating Committee, and Human Resources Committee” [Wells Fargo – “Donald M. James,” accessed 3/9/20]

• Donald James Was The Retired CEO Of Vulcan Materials Company. “Mr. James is the retired Chairman and CEO of Vulcan Materials Company, a construction materials company located in Birmingham, Alabama. He joined Vulcan Materials in 1992 and progressed through a variety of management positions at Vulcan Materials before he became chief executive officer and chairman in 1997, positions he held until July 2014 and December 2015, respectively.” [Wells Fargo – “Donald M. James,” accessed 3/9/20]

2017: Shortly After The Scandal Broke, Chao Resigned From The Wells Fargo Board To Become Transportation Secretary

CNN: Chao Told Wells Fargo She Would Be Resigning From The Bank Upon Her Confirmation As Transportation Secretary. “President-elect Donald Trump’s pick to lead the sprawling Transportation Department made $1.2 million while overseeing Wells Fargo as a director during the period the bank has admitted to creating millions of fake accounts. As a member of Wells Fargo (WFC)’s board since 2011, Elaine Chao was responsible for monitoring the bank’s actions as well as hiring and firing management. […] Chao recently informed Wells Fargo she will resign from the board of directors ‘if and when’ she is confirmed as transportation secretary.” [CNN Business, 12/7/16]

Wells Fargo Denied Chao’s Resignation Was Linked To “Any Disagreement” With The Company Or Anything Related To “Operations, Policies Or Practices.” “As a member of Wells Fargo (WFC)’s board since 2011, Elaine Chao was responsible for monitoring the bank’s actions as well as hiring and firing management. Chao recently informed Wells Fargo she will resign from the board of directors ‘if and when’ she is confirmed as transportation secretary. Wells Fargo said her decision is not linked to ‘any disagreement’ with the company or anything related to its ‘operations, policies or practices.’” [CNN Business, 12/7/16]

April 2017: Susan Engel Chose Not To Stand For Reelection To The Wells Fargo Board

2011 To 2016: Susan Engel Served With Elaine Chao On The Wells Fargo Board Of Directors During Her Full Tenure. [Wells Fargo & Company Annual Report 2011, 2011; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/15/12; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, Wells Fargo, 3/14/13; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/18/14; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/17/15; Wells Fargo & Company Notice of Annual Meeting of Stockholders, Wells Fargo, 4/26/16]

March 2017: Susan Engel Announced She Would Not Stand For Reelection To The Wells Fargo Board. “Wells Fargo & Co says on Feb 28, Susan Engel, a member of board of Wells Fargo & Company informed company that she will not stand for re-election” [Reuters, 3/1/17]

April 25, 2017: Engel Retired At The Annual Meeting Of Stockholders. [SEC – “Wells Fargo,” 2/28/17]

2017: Three Wells Fargo Board Members Who Served With Chao Were Ousted In The Wake Of The Fake Accounts Scandal

2011 To 2016: Chao Served On The Wells Fargo Board With Cynthia Milligan, Stephen Sanger, And Susan Swenson During Her Tenure. All three board members served through Chao’s tenure from 2011 until 2016. [Wells Fargo & Company Annual Report 2011, 2011; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/15/12; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, Wells Fargo, 3/14/13; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/18/14; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/17/15; Wells Fargo & Company Notice of Annual Meeting of Stockholders, Wells Fargo, 4/26/16]

Reuters HEADLINE: “Wells Fargo Changes Board, Names Duke Chair In Response To Scandal” [Reuters, 8/15/17]

2017: Wells Fargo Directors Cynthia Milligan, Stephen Sanger, And Susan Swenson, All Of Whom Served With Chao, Announced They Were Retiring At The End Of The Year. “Wells Fargo & Co (WFC.N) Vice Chair Betsy Duke will replace retiring Chair Stephen Sanger next year, one of several changes announced on Tuesday in a board overhaul following a sales practices scandal.  […] The two longest-serving directors, Cynthia Milligan and Susan Swenson, will retire at the same time.” [Reuters, 8/15/17]

The Board Retirements Were Part Of A Larger Company-Wide Overhaul Following The Sales Practices Scandal. “Wells Fargo & Co (WFC.N) Vice Chair Betsy Duke will replace retiring Chair Stephen Sanger next year, one of several changes announced on Tuesday in a board overhaul following a sales practices scandal. […] Wells Fargo had long maintained a reputation as a well-run, highly profitable institution that managed to sell more products to customers than any of its big-bank rivals. That image was shattered nearly a year ago when it revealed that thousands of its employees created as many as 2.1 million phony accounts in customers’ names without their permission. Since then, the bank has ousted executives, clawed back pay, changed incentive structures for low-level employees and implemented a new risk-management structure.” [Reuters, 8/15/17]

The New Chair Of Wells Fargo’s Board Said The Expedited Changes To The Company’s Structure Followed Conversations With Investors. “Wells Fargo & Co (WFC.N) Vice Chair Betsy Duke will replace retiring Chair Stephen Sanger next year, one of several changes announced on Tuesday in a board overhaul following a sales practices scandal.   […] In a joint interview, Duke and Sanger said the board expedited changes to its structure and composition after discussions with investors, who offered most directors relatively little support in a vote earlier this year. ‘This company is going to end up being a better bank than it would have been without this incredible wakeup call,’ Duke said. ‘It had been so successful for so long it was difficult to recognize the need for change.’” [Reuters, 8/15/17]

March 2018: Four Board Members Were Ousted, Following An Agreement With The Federal Reserve Over The Scandal

2011 To 2016: Chao Served With John Chen, Lloyd Dean, Enrique Hernandez, Jr., And Federico Peña On The Wells Fargo Board Of Directors. All four served through the entirety of Chao’s tenure, 2011 to 2016. [Wells Fargo & Company Annual Report 2011, 2011; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/15/12; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, Wells Fargo, 3/14/13; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/18/14; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/17/15; Wells Fargo & Company Notice of Annual Meeting of Stockholders, Wells Fargo, 4/26/16]

New York Times, January 2018: Officials At The Federal Reserve Met With Wells Fargo Executives, Wanting To Send A Message That The Board Would Be Held Responsible For The Company’s Behavior. “On a Thursday evening in mid-January, a group of top Wells Fargo executives sat down for dinner in an upscale surf-and-turf restaurant near the White House. At nearby tables, power brokers ate seafood on ice and sipped cocktails out of copper mugs.  […] Officials at the central bank had a different goal, according to people familiar with their thinking. They wanted to send a message to the Wells board that it would be held responsible for the company’s behavior.” [New York Times, 2/4/18]

New York Times: The Wells Fargo Agreement With The Fed Involved Replacing Four Members Of Its Then-16 Member Board By Years End. “The Federal Reserve on Friday imposed unusually harsh penalties on Wells Fargo, punishing it for years of misconduct and barring it from future growth until the bank fixes its problems. The central bank blasted Wells Fargo’s board for failing to oversee the bank, and it announced that the company would replace four members of its 16-person board by the end of the year.” [New York Times, 2/2/18]

March 2, 2018: Wells Fargo Announced John Chen, Lloyd Dean, Enrique Hernandez, Jr., And Federico Peña Would Step Down From The Company Following A Pledge Made To The Federal Reserve. “Wells Fargo on Friday said four board members will soon step down, fulfilling a pledge it made last month as the Federal Reserve penalized the bank for years of misconduct. The four departing directors are John S. Chen, the executive chairman and chief executive of BlackBerry; Lloyd H. Dean, the president and chief executive officer of Dignity Health; Enrique Hernandez Jr., the chief executive of Inter-Con Security Systems; and Federico F. Peña, who served as both energy and transportation secretary under President Clinton.” [New York Times, 3/2/18]

• Wells Fargo Said The Departures Were Part Of Regular Succession Planning Despite Pressure From Regulators. “Wells Fargo on Friday said four board members will soon step down, fulfilling a pledge it made last month as the Federal Reserve penalized the bank for years of misconduct.  […] Wells Fargo said the departures were part of its regular succession planning, but the company has been under pressure from regulators and some shareholders to speed up the overhaul of its board. Last month, the Federal Reserve criticized the company for ‘widespread consumer abuses’ and governance failures, and forbid it from growing any larger until it shapes up.” [New York Times, 3/2/18]

January 2020: Chao’s Fellow Wells Fargo Board Member, John Stumpf, Was Barred From Working In The Banking Industry And Fined $17.5 Million

2011 To 2016: John Stumpf Served With Elaine Chao On The Wells Fargo Board Of Directors During Her Full Tenure. [Wells Fargo & Company Annual Report 2011, 2011; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/15/12; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, Wells Fargo, 3/14/13; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/18/14; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/17/15; Wells Fargo & Company Notice of Annual Meeting of Stockholders, Wells Fargo, 4/26/16]

January 2020: Former Wells Fargo CEO John Stumpf Was Banned From Ever Again Working At A Bank “In Any Manner” By The Office Of The Comptroller Of The Currency. “The U.S. government announced Thursday that former Wells Fargo CEO John Stumpf has been banned from ever working at a bank again and will pay $17.5 million for scandals in which millions of fake accounts were set up to meet sales quotas.  The notice from the Office of the Comptroller of the Currency said the regulator plans to target other individuals, including former executives, for their role in the scandals. […] In addition to the $17.5 million fine, Stumpf’s settlement declares he shall not participate ‘in any manner’ at any bank regulated by the OCC or participate or attempt to participate in a bank’s corporate board votes.” [CNBC, 1/23/20]

Stumpf Paid $17.5 Million To The OCC Over The Fake Accounts Scandal. “The U.S. government announced Thursday that former Wells Fargo CEO John Stumpf has been banned from ever working at a bank again and will pay $17.5 million for scandals in which millions of fake accounts were set up to meet sales quotas. The notice from the Office of the Comptroller of the Currency said the regulator plans to target other individuals, including former executives, for their role in the scandals.” [CNBC, 1/23/20]

March 2020: Two Wells Fargo Board Members Resigned Days Before They Were Scheduled To Testify In Front Of Congress

2014 To 2016: Elaine Chao Served With Elizabeth Duke And James Quigley On The Wells Fargo Board Of Directors. Quigley joined the company in 2014 while Duke joined in 2015. [Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/18/14; Wells Fargo & Company Notice Of Annual Meeting Of Stockholders, 3/17/15; Wells Fargo & Company Notice of Annual Meeting of Stockholders, Wells Fargo, 4/26/16]

March 8, 2020: Wells Fargo Chair Elizabeth Duke And Board Member James Quigley Resigned From The Bank Days Before They Were Scheduled To Speak To Congress. “Two Wells Fargo board members have resigned, including chairwoman Elizabeth Duke, the bank announced Monday. The departures come days after a House committee report found the bank has been too slow to reform itself in the wake of a series of scandals — including widespread fraud in the consumer banking business tied to overly aggressive sales goals. Duke, who is known to many as Betsy, was elected chair of the bank’s board effective January 2018. She had previously served as vice chair between October 2016 and December 2017. Wells Fargo said her resignation and that of another board member, James Quigley, were effective Sunday.” [NPR, 3/9/20]