Wells Fargo cutting sales goals in wake of $185 million fine
NEW YORK (AP) — Wells Fargo will cut its aggressive product sales goals for retail bankers, as it faces $185 million in fines and a damaged reputation after allegations that it opened millions of unauthorized accounts to meet those targets.
The sales goals will be eliminated by Jan. 1, the San Francisco-based bank announced Tuesday. That doesn't end the matter, though, as Wells Fargo's chief executive has been called to appear before the Senate Banking Committee next week to answer questions about the bank's sales practices.
Wells Fargo has long been known for its aggressive sales goals, but in an industry plagued with questionable action during the mortgage bubble and financial crisis, it was also regarded as a well-run, tightly managed firm that did not get into the poisonous behavior of its Wall Street counterparts.
Americans got raise last year for first time since 2007
WASHINGTON (AP) — In a long-awaited sign that middle-class Americans are finally seeing real economic gains, U.S. households got a raise last year after seven years of stagnant incomes. Rising pay also lifted the poorest households, cutting poverty by the sharpest amount in nearly a half-century.
Higher minimum wages in many states and tougher competition among businesses to fill jobs pushed up pay, while low inflation made those paychecks stretch further. The figures show that the growing economy is finally benefiting a greater share of American households.
The median U.S. household's income rose 5.2 percent in 2015 to an inflation-adjusted level of $56,516, the Census Bureau said Tuesday . That is the largest one-year gain on data stretching back to 1967. It is up 7.3 percent from 2012, when incomes fell to a 17-year low.
Oil prices hit by downward revision to global oil demand
LONDON (AP) — Oil prices took a pounding Tuesday after a leading industry group said global oil demand growth is slowing by more than previously thought, largely because of a more pronounced economic slowdown during the third quarter of the year.
In its September oil market report, the Paris-based International Energy Agency reduced its forecast for global demand growth to 1.3 million barrels a day in 2016 — 100,000 below the previous forecast.
And it also anticipates a further slowdown next year, down to 1.2 million barrels a day "as underlying macroeconomic conditions remain uncertain."
Atlanta Fed president leaving in February
WASHINGTON (AP) — Dennis Lockhart, the president of the Federal Reserve's Atlanta regional bank, announced Tuesday that he plans to step down in February of next year.
Lockhart is leaving after a decade as president of the Atlanta bank, one of the Fed's 12 regional banks. He said he plans to pursue his interests in public policy, civic work and private business after stepping down on Feb. 28.
Lockhart has been a supporter of Fed Chair Janet Yellen's cautious approach to raising interest rates, though he is not one of the voting members of the Fed's policy committee this year. In a speech Monday, Lockhart said he believed economic conditions justified "serious discussion" of a rate hike in September.
US budget deficit totals $107.1 billion in August
WASHINGTON (AP) — The federal government recorded a deficit of $107.1 billion in August, slightly lower than the July deficit. But the imbalance through 11 months of this budget year is up sharply from a year ago, reflecting higher spending and lower-than-expected tax revenues.
The Treasury Department said Tuesday that the deficit, with just one month to go in the budget year, totals $620.8 billion, up 17.1 percent from the same period a year ago. The August deficit was slightly lower than the $112.8 billion imbalance in July.
The Congressional Budget Office last month revised its estimate for the 2016 deficit up sharply to show an imbalance of $590 billion. That was up from a March projection of $534 billion. The budget year ends on Sept. 30 and September is expected to show a surplus.
State lawyer defends case against former AIG boss Greenberg
NEW YORK (AP) — The state pressed on for more than a decade with civil fraud claims against a 91-year-old former chief executive of insurance company American International Group Inc. as a warning to other executives that wrongdoing won't go unpunished, a state attorney told a judge on Tuesday during a trial's opening statements.
Assistant Attorney General David Ellenhorn said former AIG boss Maurice R. Greenberg was "not your typical 91-year-old" as he explained the state's persistence in pursuing the case against him and the company's former chief financial officer.
Ellenhorn said he wanted to send a message to other top executives who may be much younger than Greenberg so they know "you cannot manipulate the books of a public company to give a false impression of your company."
Dakota Access CEO: Company committed to finishing project
BISMARCK, N.D. (AP) — The head of a Texas company building the $3.8 billion Dakota Access pipeline told employees Tuesday that it is committed to the project despite strong opposition and a federal order to voluntarily halt construction near an American Indian reservation in North Dakota.
The memo to employees, which was also released to some media outlets, is the first time in months the company has provided significant details of the four-state, 1,172-mile (1886-km) project.
It came the same day as a planned "day of action" in cities around the U.S. and in other countries, including a rally that drew hundreds in Washington to hear Sen. Bernie Sanders and others speak. Authorities also arrested 22 people for interfering with construction on the pipeline about 70 miles (113 km) northwest of the main protest site near the Standing Rock Sioux Reservation in North Dakota.
Energy Transfer Partners CEO Kelcy Warren told employee the pipeline is nearly 60 percent complete and that "concerns about the pipeline's impact on the local water supply are unfounded."
House conservatives offer resolution to impeach IRS chief
WASHINGTON (AP) — Two Republican congressmen formally offered a campaign-season resolution Tuesday to impeach IRS chief John Koskinen, setting the House on course for showdown votes over an effort that rouses conservatives but has no chance of ousting the commissioner from office.
The proposal by conservative Reps. John Fleming, R-La., and Tim Huelskamp, R-Kan., is expected to face votes Thursday in which its fate is unclear. With solid opposition from Democrats and resistance from many Republicans who consider it excessive and politically damaging, the measure might end up being killed and replaced by a censure motion that would scold Koskinen but leave him in his job.
The House Oversight and Government Reform Committee voted along party lines in June to censure Koskinen
The Dow Jones industrial average gave up 258.32 points, or 1.4 percent, to 18,066.75. The Standard & Poor's 500 index fell 32.02 points, or 1.5 percent, to 2,127.02. The Nasdaq composite lost 56.63 points, or 1.1 percent, to 5,155.26.
U.S. crude fell $1.39, or 3 percent, to $44.90 a barrel in New York. Brent crude, the benchmark for international oil prices, slid $1.22, or 2.5 percent, to $47.10 a barrel in London. Wholesale gasoline lost 1 cent to $1.38 a gallon. Heating oil sank 2 cents to $1.42 a gallon. Natural gas fell 1 cent to $2.91 per 1,000 cubic feet.