Buffett says Wells Fargo made ‘big mistakes,’ did ‘crazy things’
One of the first questions for Warren Buffett at Berkshire Hathaway’s shareholder meeting Saturday was about why he’s been relatively quiet about Wells Fargo’s scandals.
The question was met with a healthy dose of applause, especially since the shareholder mentioned that it seemed odd that the company showed Buffett’s famous quote about being “ruthless” if anyone lost a “shred of reputation” for Berkshire Saturday morning.
The Oracle of Omaha’s response? He said that the bank made some “big mistakes” and incentivized wrong behavior and did some “crazy things.”
Buffett added that he wishes CEOs wouldn’t go away “so rich” after doing dumb things and suggested that executives and board members have compensation clawed back if a company has committed wrongdoing.
He also said that average Wells Fargo shareholders who have done nothing wrong are the ones that are paying the price for the company’s misdeeds. The company has admitted workers opened millions of fake accounts, charged thousands of borrowers for auto insurance they didn’t need and hundreds of home owners for mortgage fees they didn’t deserve.
But Buffett stopped short of blaming former CEO Tim Sloan for the bank’s numerous scandals. Sloan stepped down suddenly in March.
And Berkshire vice chairman Charlie Munger even went so far as to say he wished Sloan was still there.
Those remarks may not satisfy critics though, who want to see major changes at Wells Fargo.
Buffett has recently said in another interview with the Financial Times that he thinks Wells Fargo should look to hire a new CEO that doesn’t have ties to Wall Street.