California lawmakers denounce Wells Fargo at hearing, call for statewide banking reform

More than a month after regulators announced a sweeping settlement against Wells Fargo & Co. over its creation of unauthorized customer accounts, lawmakers went after the bank again Tuesday and called for reforms that could rein in abusive practices by banks.

The hearing, called by the Assembly’s Banking Committee, lacked the outrage federal lawmakers displayed at Capitol Hill hearings on the issue. But Assembly members attacked Wells Fargo for harming its customers by allowing thousands of employees to open as many as 2 million unauthorized accounts over the last five years.

“Wells Fargo did wrong,” said Assemblyman Travis Allen (R-Huntington Beach), the committee’s vice chairman, at the hearing in Calabasas City Hall. “Clearly there was a problem. Millions of accounts were created that never should have been created. How did this happen in the first place, and how did it go on for so long?”

Before the hearing even got underway, Matt Dababneh (D-Encino), the committee’s chairman, said he would consider state legislation that would prevent Wells Fargo and other institutions from using arbitration clauses to shield themselves from lawsuits over unauthorized accounts.

Read on.

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