LOS ANGELES — California Treasurer John Chiang says Wells Fargo’s admission that thousands of its bank employees opened more than 2 million fraudulent accounts is a legal and ethical outrage.
On Wednesday, he put the state’s money where his mouth is.
Chiang said the state will no longer invest in Wells Fargo securities or use the bank to buy stocks and bonds.
Jaime Court, president of Consumer watchdog, says this move by the state’s treasurer will not hurt the bank too much financially, but it could damage its reputation as one of the state’s oldest and trusted banks. That could hurt its stock value in the long run.
Chiang says this move will take effect immediately and remain in place for the next 12 months.