Wells Fargo Argues That Wall Street Journal Story Is Inaccurate


 
 
09:14 11/28/2017

Wells Fargo & Co. WFC  is taking issue with the allegations that its foreign exchange pricing is unfair and unfavorable to customers. The Wall Street Journal ran a story on November 28, 2017 that featured the accusation, and the company has fired back on many fronts. Wells Fargo Wholesale Banking Head Perry Pelos believes that The Journal did not represent Wells Fargo’s position accurately. “We informed The Wall Street Journal that their story had fundamental inaccuracies before they published. We provided pricing data and other information that revealed inaccuracies in the story or that were counter to its negative portrayal of our FX business. Our points and views were either absent in the finished story or not taken seriously by the paper.”



Wells Fargo attacked the article on numerous fronts:



The Wall Street Journal article asserted that an internal review of approximately 300 fee agreements found that only 35 companies were charged the true price they were offered for currency trades. Pelos contends that no such internal review was ever conducted by the business, nor did any review reach such a conclusion. The paper used a plethora of unnamed sources and an alleged conference call that could not be verified by Wells Fargo.



The article also seemed to imply that Wells Fargo is pricing FX transactions in the one to four percent range (100-400 basis points). The Journal went a step further in arguing that this pricing was improper and outside of industry standards. This contention was made even after it was explained that wider-spread outcomes are not uncommon in smaller, low volume FX transactions. Wells Fargo also took issue with what they believed to be a very misleading graphic showing industry average fees, but did not take into account the weighted average volume for middle market fees. The Journal also alleged that a bell was rung anytime a major sales transaction was completed, which was a transparent attempt to exaggerate a sales-driven culture in the FX business. Pelos informed the paper that this practice was discontinued more than ten years ago, a fact The Journal did not include.



“While we have made some mistakes in the past, we always work to make it right for our customers, and invite them to reach out to us if they have any issues. But, in our view, the article’s characterization of our overall business practices and commitment to our FX customers is misleading and unfair,” said Wells Fargo CEO and President Tim Sloan. “We proudly serve thousands of customers in our foreign exchange business and are committed to helping them succeed.”


This article has been provided by a Chasing Markets contributor. All content submitted by this author represent their personal opinions, and should be considered as such for entertainment purpose only. All opinions expressed are those of the writer, and may not necessarily represent fact, opinions, or bias of Chasing Markets.
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