John Stumpf exits Wells Fargo after account scandal

Last Updated Oct 12, 2016 7:58 PM EDT

The Wells Fargo (WFC) wagon rolled over John Stumpf on Wednesday, as the scandal-ridden bank announced his resignation as chairman and chief executive officer, effective immediately.

“While I have been deeply committed and focused on managing the Company through this period, I have decided it is best for the Company that I step aside,” Stumpf said in a statement released by the bank. He’s a 34-year veteran of Wells Fargo, the nation’s second-biggest bank.

Stumpf’s downfall began on Sept. 8, when the Consumer Financial Protection Bureau said Wells Fargo had agreed to pay $185 million to settle allegations it opened as many as 2 million unauthorized accounts.

Both the Senate and House held hearings, with lawmakers from both sides of the political aisle lambasting Stumpf for his bank’s pinning the fraud on 5,300 low-level employees who subsequently lost their jobs.

The 63-year-old banker’s departure comes two weeks after Wells Fargo said Stumpf and the executive who ran the bank’s consumer banking division would forfeit tens of millions of dollars in bonuses as it tried to stem an outcry over its sales practices.

Still, USA Today reports Stumpf is walking away with $134.1 million in retirement pay, citing the executive compensation consultancy Equilar as its source for the information. Much of that payout could presumably be in the form of vested company stock accumulated over Stumpf’s decades working for the bank. Sen. Elizabeth Warren of Massachusetts, for instance, tweeted the following demand not long after news broke of Stumpf’s exit:

Tim Sloan, president and chief operating officer, will succeed Stumpf as CEO, and Stephen Sanger, the board’s lead director, will serve as its nonexecutive chairman, the company said in a statement.

“Stumpf has dedicated his professional life to banking, successfully leading Wells Fargo through the financial crisis and the largest merger in banking history, and helping to create one of the strongest and most well-known financial services companies in the world,” said Sanger. “However, he believes new leadership at this time is appropriate to guide Wells Fargo through its current challenges and take the Company forward.”

Stumpf  joined Wells Fargo in 1982 as part of the former Norwest Bank and became its CEO in June 2007 and its chairman in 2010.