A group of Democratic senators asked Wells Fargo’s chief executive for more details about the bank’s recent boost in income from overdraft charges and whether it is related to its sales-practices scandal, according to a letter reviewed by The Wall Street Journal.
Senate Banking Committee Democratic senators led by Ohio Sen. Sherrod Brown and Massachusetts Sen. Elizabeth Warren asked why the San Francisco bank’s income from overdraft fees increased at a rate roughly five times higher than its peers as noted in a recent Financial Times article.
“Wells Fargo’s overdraft income has increased disproportionately to the rest of the banking industry in the same way that Wells Fargo’s cross selling exceeded that of its competition,” according to the letter. It added that compensation incentives for overdraft services in some cases were structured similarly to those for banking accounts and credit cards.
A Wells Fargo spokeswoman said the bank hasn’t made any changes to its practices that would result in more or higher overdraft fees for customers. She added that the bank hasn’t had any banker incentive compensation or sales goals related to overdrafts.