Big banks have destroyed the integrity of our financial system. In fact, they nearly destroyed the entire banking-system in the financial crash between 2009-2011. Due to the bailouts of Presidents Bush and Obama, we now have a lot fewer banks for which to choose. Moreover, Big banks are now much larger.
Yet, we still have rampant cheating.
Just recently, we learned that Wells Fargo had opened up 2 million illegal accounts in customers’ names. Those customers were fined in many of those illegal accounts. The reason? Wells Fargo branch managers had to meet their quotas and over 5000 of them were willing to do anything to keep their job. If they couldn’t meet their quotas legitimately, they opened extra accounts illegally.
As a result, the government has fined Wells Fargo $185 million. This sum to the average American is equivalent to the change in our pockets — a pittance to Wells Fargo.
Taxpayer gave trillions in bailouts and the government instituted thousands of new pages in regulations to stop the cheating in the financial industry in the wake of the ‘Great Recession.’ But did we fix anything?
No! The federal government (especially in the financial sector) is always fighting the last battle from the war that we lost. During the entire term of the Obama administration they have been rewriting the rules of banking and mortgage. These new rules are so complex and overly burdensome that you now have to ‘give a pint of blood’ in order to simply open a checking account or conduct a financial transaction with your own money.
The Consumer Financial Protection Bureau assures us this is an isolated case and does not represent a systematic problem. I beg to differ.
Reportedly, Wells Fargo is now being investigated by federal prosecutors for their behavior. Calling all of his employees risk managers, perched from high atop his ‘ivory tower,’ Wells Fargo CEO John Stumpf said he holds himself accountable but will not comply with calls to resign.
Stumpf presides over a company whose culture has developed into cheating and stealing — essentially the same are practices that eventually led to a mortgage meltdown in 2008 (presumably as a way to make up for lost revenue opportunities due to Dodd-Frank). This time, instead of cheating mortgage-bond investors, they are cheating their customers.
Can you imagine the painful process of walking into a Wells Fargo branch after learning you had an illegal credit card or bank account opened in your name — which have racked up fees (with a looming impact to your credit) — and attempting to explain you never opened the account? I suspect you would have been met with that infamous fake ‘Wells Fargo smile’ as they told you there was nothing they could do about it.
In the big banks’ world, they never make a mistake while you and I are nothing but a bunch of idiots and ‘know-nothings.’ We’ve allowed them to treat us this way by continuing to comply with their ridiculous rules and arbitrary procedures (at our expense).
Stumpf told CNBC’s Jim Cramer that “Our goal is to make it right by the customer every time, 100%, and if we don’t do that, we feel accountable.” I suppose that explains the $124.6 million severance package given to the head of its consumer banking executive who ultimately presided over bank-sector that created this catastrophe.
Recently, I attempted to open a checking account for a newly-formed company with our partners in two states. I was given the ‘it’s a great day at Wells Fargo’ pitch in order to get us to open this account (in the branch). After opening the account and depositing a large sum of money, we discovered that they would not allow one of the partners to be legally added to the account because he was in a different state. We were later told we should go online to open the account where it would be much easier. That turned into an even bigger nightmare.
Thankfully, we gave a Wells Fargo banker one more win for her sales quota while we wasted countless hours before finally going to a different bank. Mr. Stumpf: What’s that about ‘making it right?’
The experience of being treated like a Columbian drug-dealer who’s laundering money (in the name of fraud prevention) is laughable considering the real fraud prevention effort should have been on the inside – not on people like me/us.
We bailed out every major bank in America with money from hard-working taxpayers. In their infinite wisdom, the Liberals passed the Dodd-Frank legislation which empowered these ‘bailed out big-banks’ to benefit from the very chaos the bill created. The banks ‘lawyered-up’ and discovered ways to cheat the intent of the law just like Hillary Clinton cheats the integrity of the national security without being prosecuted.
Big banks like Wells Fargo now have steamrolled smaller banks (who can’t afford the costs of compliance), putting many out of business, and ultimately destroyed what little integrity was remaining in the banking system.
Not a single top banking executive has been prosecuted for the illicit behavior of the big banks in the wake of the great recession – which they created. In fact, former Atty. Gen. Eric holder (who had the power to bring those bankers to justice) is now working for a law firm that represents some of those very banks.
The only remaining power the American people have to stop this madness is to use our feet to flee these despicable institutions in favor of doing business with smaller banks and financial firms that treat customers with respect.
With all the talk of liberals like Obama and Clinton ‘looking out for the little people,’ it sure does seem they’ve empowered the big Wall Street banks to continue cheating America out of its own money.
In fairness to Obama, Holder (and people like Clinton), It’s hard to prosecute your friends isn’t it?