Wells Fargo warned to cut back on bonuses after fake account scandal

The fallout from Wells Fargo's fake account scandal shows no signs of letting up, as investors in the US bank have called for a cutback in bonuses paid to top executives as a result of the misdemeanour.

Regulators revealed last week that staff from the world's most valuable bank by market capitalisation created new accounts and credit cards without the knowledge of the customers whose name they were under.

5,300 employees lost their positions from Wells and the bank was fined $185m as a result of the action.

Further controversy arose when Carrie Tolstedt, who was in charge of the division where the infringement took place, was revealed to have been given large bonuses ahead of her retirement from the bank.

A major investor in the group told the Financial Times that there must be a clawback in Tolstedt's situation.

"There’s no point having a clawback if it doesn’t claw in circumstances like this," the shareholder said. "What has happened at Wells is an affront to the integrity of the institution."

Another shareholder told the same publication that "we have share-based pay so that it can be clawed back when people have been earning bonuses under false pretences, and if fraudulently opening client accounts isn’t false pretences, then I don’t know what is."

Wells Fargo has received a barrage of criticism since the disclosure of the events, notably from Democratic senator Bernie Sanders and ratings firm Moody's.