The Los Angeles City Council passed a motion last week to restrict large banks vying for city contracts from using predatory sales goals, in response to the furor over Wells Fargo's phony-accounts scandal.
The motion does not ban sales goals but would require that banks bidding for city business certify that their sales practices are not predatory. The motion by Councilman Paul Koretz passed unanimously last Tuesday. Wells Fargo is the primary bank for the city of Los Angeles and its contract expires next year.
Los Angeles City Attorney Mike Feuer also is expected to draft an amendment to the city's Responsible Banking Ordinance that would provide protections to whistleblowers who report illegal practices to regulators.
Feuer and two federal regulators reached a $190 million settlement with Wells in September, when the bank said it had fired 5,300 employees who opened 2 million unauthorized accounts to meet stringent sales goals.
The city council also approved a motion for the city's Office of Finance to investigate whether Wells opened unauthorized accounts for the city going back to 2008.