John Stumpf steps down as CEO of Wells Fargo

Embattled Wells Fargo CEO John Stumpf has resigned from his position effective immediately in the wake of the fake account scandal which rocked the US bank last month.

In September the California-based bank announced that it had agreed to pay out $185m to regulators after creating unauthorised accounts and credit cards for its customers.

Stumpf appeared before committees in both the House of Representatives and the Senate to explain his company's actions, after 5,300 employees were sacked as a result of the practice.

The former executive "will not receive any severance payment", according to the Guardian, but further reports suggest he will walk away with a pay packet of $134m.

He will be replaced by former chief operating officer of the bank Timothy Sloan, the bank said in a statement.

"I have decided it is best for the company that I step aside. I know no better individual to lead this company forward than Tim Sloan," Stumpf said.

Elizabeth Warren, the senator who was leading the lawmakers' scrutiny of Stumpf and Wells Fargo, has said that his decision still does not provide real accountability for the company's actions.

"If Mr. Stumpf is leaving with all of his ill-gotten millions that's still not real accountability," Warren told Business Insider.

"A bank teller would face criminal charges and a prison sentence for stealing a handful of 20s from the cash drawer. A bank CEO should not be able to oversee a massive fraud and simply walk away to enjoy his millions in retirement."