Wells Fargo is still at it

This past Wednesday the normally insightful Seeking Alpha website had an ironic article titled Wells Fargo - A Return To Ethical Banking?

This came out just two weeks after Wells Fargo paid a $142 million to settle a lawsuit for "creating some 2.1 million unauthorized checking and savings accounts, credit cards, and lines of credit without customer approval."
They also paid regulators $185 million.

The very next day Wells Fargo got hit with another scandal.

As Wells Fargo & Co. continues to be hit with fallout from its sham-accounts scandal, the bank is facing allegations that it put the screws to customers in yet another way: by slapping them with fees for delays in processing mortgage applications.
A former Wells Fargo mortgage banker who worked in Beverly Hills alleged in a lawsuit this week that the bank falsified records so it could blame holdups on borrowers — and that it fired him for trying to report the practice...
In his lawsuit, former banker Mauricio Alaniz alleged that the Wells Fargo’s mortgage-processing and underwriting division was understaffed, leading to chronic delays that were not borrowers’ fault. But rather than have the bank waive the rate-lock fee, workers would falsely report that borrowers had submitted incomplete or inaccurate information, according to the suit.

The Seeking Alpha article comes just a few days after Wells Fargo was forced to rehire a whistleblower, along with $577,500 in back pay and damages.

This all happened just in July.
But you know what they say about cockroaches and bankster scandals - if you see one then you know there is a whole colony of them somewhere.

So you won't be surprised when this happened the day after that Seeking Alpha article.

More than 800,000 people who took out car loans from Wells Fargo were charged for auto insurance they did not need, and some of them are still paying for it, according to an internal report prepared for the bank’s executives.
The expense of the unneeded insurance, which covered collision damage, pushed roughly 274,000 Wells Fargo customers into delinquency and resulted in almost 25,000 wrongful vehicle repossessions, according to the 60-page report, which was obtained by The New York Times. Among the Wells Fargo customers hurt by the practice were military service members on active duty.

In response to this newest revelation, the NYC Comptroller Scott M. Stringer released a classic statement.

“This is a full-blown scandal — again. It’s unbelievable, outrageous, sad, and yet quintessential Wells Fargo. This isn’t just a corporate debacle. It’s caused real human harm. It’s reflective of a system that Americans feel is rigged against the little guy, and sadly symbolic of a culture that puts short-term profits ahead of creating sustainable value for shareowners. Everyday families have suffered and tens of millions of hard-earned dollars were stripped from unsuspecting Americans, many of whom are struggling just to get by.

So we can already answer the question that Seeking Alpha asked: Wells Fargo - A Return To Ethical Banking? No. Absolutely not.

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Meteor Man's picture

Wells Fargo makes big bucks, the executives responsible get huge bonuses and their stock goes up! What's the problem?
There is no reason for Wells Fargo or any other financial institution to obey the law, because Obama, Joe Biden, Hillary, Chuck Schumer, Rahm Emmanuel, ditto, ditto, ditto, all are on their payroll.

Who is against corporate racketeering? Well believe it or not The American Conservative:
http://www.theamericanconservative.com/articles/the-ultimate-trifecta-of...

But the reality is that capitalism is distorted by corporate welfare policies, which are antithetical to free markets. Such policies provide special preferences, protections, and subsidies to the favored few as a hedge against competition.

It would be nice if The DLC was as outspoken about crony capitalism as The American Conservative.

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"They'll say we're disturbing the peace, but there is no peace. What really bothers them is that we are disturbing the war." Howard Zinn

thanatokephaloides's picture

@Meteor Man

But the reality is that capitalism is distorted by corporate welfare policies, which are antithetical to free markets.

The actual reality is that there is no such thing as "free markets". Either the society makes restrictive rules for markets via government (regulation), or the strongest actors dictate to everyone else (law of the jungle). That's why capitalism is what free enterprise deteriorates into. Once market actors exist who are large and powerful enough to rule over others, free enterprise is history.

The American experience with free enterprise only lasted as long as it did because of the New Deal's regulatory structure, which was designed to maintain as free enterprise a system as possible for as long as possible. But once Newt Gingrich and Co. declared their Contract ON Amreica, all that went away forever. Today, we have government enforcing the law of the jungle, not combating it!

Diablo

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"US govt/military = bad. Russian govt/military = bad. Any politician wanting power = bad. Anyone wielding power = bad." --Shahryar

"All power corrupts absolutely!" -- thanatokephaloides

@thanatokephaloides

The actual reality is that there is no such thing as "free markets".

Markets are either regulated, or gamed. There is no in-between. This is something free-market conservatives/neoliberals can't/won't admit.

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@nosleep4u
It's a catchy moniker. Most everybody likes things that are "free", and "markets" are very popular places. But as you look around, and watch everything small being destroyed by everything big, you have to wonder if what we've got here has anything to do with either freedom or markets.

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native

@native

A free for all, with all free for the taking by the top fraction of the 1%?

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Psychopathy is not a political position, whether labeled 'conservatism', 'centrism' or 'left'.

A tin labeled 'coffee' may be a can of worms or pathology identified by a lack of empathy/willingness to harm others to achieve personal desires.

orlbucfan's picture

That'll be a cold day in you-know-where! Rec'd!!

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Inner and Outer Space: the Final Frontiers.

@orlbucfan

But every day is Opposite Day in 'legally' propagandized America! Orwell, whadda ya want me to say?

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Psychopathy is not a political position, whether labeled 'conservatism', 'centrism' or 'left'.

A tin labeled 'coffee' may be a can of worms or pathology identified by a lack of empathy/willingness to harm others to achieve personal desires.

snoopydawg's picture

when there are no consequences for committing crimes against people, then the crimes are going to continue.
If they only have to pay a few million after they have made billions in profits, what's going to deter in the future.
Obama not prosecuting bank CEOs is a sure fire reason to expect more fraud and another banking crisis is around the corner.
The saying that the punishment should fit the crime is dead in America. Iceland was the only country that punished the bank CEOs and look at how well they recovered from the economic crisis.
Did they nationalize the banks?

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Was Humpty Dumpty pushed?

thanatokephaloides's picture

@snoopydawg

Iceland was the only country that punished the bank CEOs and look at how well they recovered from the economic crisis. Did they nationalize the banks?

Better: the Icelandic Government seized and dissolved them:

On 29 September 2008, it was announced that Glitnir would be nationalised. However, subsequent efforts to restore faith in the banking system failed. On 6 October, the Icelandic legislature instituted an emergency law which enabled the Financial Supervisory Authority (FME) to take control over financial institutions and made domestic deposits in the banks priority claims. In the following days, new banks were founded to take over the domestic operations of Kaupthing, Landsbanki and Glitnir. The old banks were put into receivership and liquidation, resulting in losses for their shareholders and foreign creditors. Outside Iceland, more than half a million depositors lost access to their accounts in foreign branches of Icelandic banks. This led to the 2008–2013 Icesave dispute, that ended with a ESA ruling that Iceland was not obliged to repay Dutch and British depositors minimum deposit guarantees.

source

I'd love to live in nIceland..... Smile

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"US govt/military = bad. Russian govt/military = bad. Any politician wanting power = bad. Anyone wielding power = bad." --Shahryar

"All power corrupts absolutely!" -- thanatokephaloides

Had a buddy who applied for mortgage loan modification. Rejected. First, they tried to basically run out the clock for the application by constantly saying his documentation was inadequate or flawed. And the reasons published on his account page had absolutely nothing to do with the original rejection which he found out by calling them. But he persisted and then it went forward and rejected by underwriters. When he called his assigned account rep. her phone was always busy and eventually could not even leave a message the box was full. He would get other account representatives and when he asked about his rep, buddy said answer was always "erh, ah, ah...".

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