Rhode Island Will Join Investors Demanding Wells Fargo Come Clean

PROVIDENCE, RI–Seth Magaziner, the state's general treasurer, has joined other institutional investors demanding a full accounting from Wells Fargo.

Specifically, the investors want Wells Fargo to "address recent revelations of widespread consumer fraud and take steps to protect customers and shareholders from illegal predatory banking going forward."

The big bank came under fire when it was revealed its employees opened accounts for thousands of unwitting customers and charged them fees.

"Rhode Island joins a coalition of investors, including The Sisters of St. Francis of Philadelphia and members of the Interfaith Center on Corporate Responsibility in co-filling a shareholder proposal requesting that Wells Fargo issue a comprehensive, public report on 'the root causes of the fraudulent activity and steps taken to improve risk management and steps taken to improve risk management and control processes,'" his office said.

"The Office of the Rhode Island General Treasurer believes releasing the requested information is in the company's best interest and adoption of this proposal will lead to stronger investment performance for Rhode Island pension system and all Wells Fargo shareholders," the press release continued.

Rhode Island has sunk about $7.5 million into Wells Fargo, according to Evan England, the treasurer's communications director.

"As of 11/14/2016 we held 143,656 shares," he said. "In the current market, that would be approximately $7.5 million in value. As a frame of reference, $7.5 million is about 0.2% of our total global stock market portfolio (valued at about $3.4 billion) and about 0.1% of the total value of the fund."

Magaziner on Nov. 17 co-filed a shareholder proposal "calling on Wells Fargo to address unacceptable consumer fraud," England said.

"Wells Fargo allowed millions of Americans to fall victim to widespread fraud and the full extent of the damage to their customers, employees, and shareholders is still unknown,"Magaziner said. "On behalf of Rhode Island taxpayers and members of the State's pension system, we are entitled to know what Wells Fargo allowed to happen and what steps they are taking to ensure that it can never happen again."

The bank paid a $185 million settlement to the Consumer Financial Protection Bureau in September, Magaziner said. "This is only the latest in a series of penalties for charges of long-term widespread fraud, ethical lapses and discrimination within the company."

Over the past 12 months, the stock has traded between $43 and $62 per share. It closed Friday at $52.82.