When lawmakers confront Wells Fargo & Co.’s top executive over sales practices Tuesday, they will zoom in on one topic that could have broad implications for the financial industry: whether banks should do more to take back executive pay tied to profits derived from illicit actions.

Gearing up for a congressional hearing, five Democratic senators last week pressed the bank to “claw back” some pay in a compensation package promised to a departing Wells Fargo executive.

The hearing could stoke political momentum for new rules governing pay practices at the nation’s biggest banks, one of the remaining aspects of the Wall Street regulatory overhaul that President Barack Obama aims to complete before leaving office in January. Read More