Committee advances amended Wells Fargo sanctions resolution after controller outlines limited suspension

The Budget & Finance Committee voted to send an amended resolution to the full Board that calls for a city inventory of business with Wells Fargo, urges investigations by the city attorney and district attorney, and asks city financial officers to explore options for reducing municipal ties with the bank. The original measure sought broader sanctions, but the committee accepted changes reflecting the Controller’s memo and the Treasurer’s concerns about consumer harm.

Jeremy Pollack, legislative aide to Supervisor John Avalos, presented amendments derived from the Controller’s inventory. City Controller Ben Rosenfield said his office had conducted an inventory and recommended suspending new business with Wells Fargo for certain financial services, while explicitly cautioning against excluding the bank from competitive bond underwriting and major credit facilities. Rosenfield said excluding Wells Fargo from underwriting could reduce competition and raise the city’s costs; he cited a recent PUC competitive sale where Wells Fargo’s low bid yielded approximately $3.4 million in gross savings over the life of the bond compared with the runner‑up.

Treasurer Amanda Fried described actions the Treasurer’s Office had taken to protect consumers, including suspending Wells Fargo from the Bank on San Francisco program and establishing a free hotline for potentially affected customers. Fried said the bank’s conduct—creating unauthorized accounts and in some cases transferring funds into those accounts—has had demonstrable consumer impacts: “roughly 85,000 of the unauthorized accounts actually incurred more than $2,000,000 in banking fees,” she told the committee.

Representatives of Wells Fargo stood at the podium to respond. Jim Foley, president of the bank’s Pacific Northwest team, apologized for the bank’s misconduct, said senior leadership changes had been made, and described steps including product‑goal elimination in community banking and $2.6 million refunded nationwide for affected customers. Wells Fargo government‑banking executives emphasized the bank’s role in municipal finance and the operational risks of abruptly severing certain services.

Community groups including the California Reinvestment Coalition urged the committee to preserve a strong sanctions posture, noting a history of discrimination and foreclosure practices as well as the recently reported creation of sham accounts. Testimony reflected a split: community advocates urged broad restrictions and investigations; the controller and treasurer recommended a calibrated approach that mitigates harm to taxpayers and ratepayers.

The committee accepted amendments to remove two clauses: (1) a requested suspension of Wells Fargo from competitive bond underwriting; and (2) language urging revocation of the naming rights at the new San Francisco General Hospital Plaza. Supervisor Katie Tang moved to strike those clauses and then moved to forward the resolution, as amended, to the full Board with a positive recommendation.

Next steps: the amended resolution will be considered by the full Board; controller and Treasurer offices will continue inventories and recommended suspensions for defined services, while departments will evaluate contract‑level steps that can be taken consistent with fiduciary responsibilities and procurement rules.