Wells Fargo chief Stumpf quits Fed panel as pressure rises

Wells Fargo chief executive officer John Stumpf resigned from a Federal Reserve advisory council on Thursday as pressure buildt on the company following the revelations about its fake accounts scandal.

Regulators found during an investigation into the California bank that it had created 2m unauthorised accounts and credit cards for its customers. It was fined $185m for the practice and 5,300 staff lost their positions.

Stumpf appeared before a senate committee this week to answer questions from senators regarding his role in the company's practice.

Lawmakers led by Senator Elizabeth Warren stepped up the pressure on Stumpf after the hearing, recommending that he should not be reappointed to the 12-strong council, which is made up of banking and finance industry leaders.

In the end, the CEO resigned on his own accord. The bank released a statement which said that the decision was a "personal" one.

An investigation into how Wells Fargo treats its employees is expected to be carried out by the Department of Labor, and it said it was "taking very seriously" the allegations put forward by the senators.

The bank recently lost its title of the world's largest bank by market capitalisation, being taken over by JP Morgan Chase after its share price fell in the wake of the scandal.