Elizabeth Warren just destroyed a corrupt big banker and reminded us why we love her so much. This guy just learned a big lesson the hard way….Elizabeth Warren don’t play.
On Tuesday Wells Fargo CEO John Stumpf went before the Senate Banking Committee. The hearing was about the fraudulent activities of Wells Fargo, and the panel did not go easy on the big banker. He went through a grilling from the Committee, but none of them were as tough as Senator Elizabeth Warren.
Wells Fargo was doing something called “cross-selling” which resulted in thousands of bankers opening over 2 million accounts for customers without them ever knowing about it. Low-level bank employees were pressured to sell EIGHT different services to each of their customers. This led to employees forging signatures, committing identity theft, and opening up millions of fake accounts so that they could reach those sales goals. If they didn’t reach those goals, they faced firing.
“The outrageous scandal at Wells Fargo & Co., for which federal and local regulators hammered the bank for $185 million in fines and penalties earlier this month, speaks volumes about the decline of morality in corporate America. But the settlement leaves one burning question unanswered: Why does John G. Stumpf, the company’s chairman and CEO, still have a job? […]
The settlement stemmed from a scheme in which Wells Fargo bankers opened as many as 2 million fake accounts in the names of existing retail customers or nonexistent persons in efforts to meet unrealistic sales goals imposed from above. The bank says it fired 5,300 employees from 2011 through 2015, but it refuses to say how high up the discipline went. Plainly, most of the firings took place among the rank and file. […]
[T]here is no model of corporate management in which Stumpf can’t be considered responsible for what Sen. Elizabeth Warren, D-Mass., labeled the “staggering fraud” underlying the settlement, or for the devastating blow to his company’s reputation. Carrie Tolstedt, the executive who led the division where the fakery occurred, reported directly to him. So he either knew about it, in which case he is complicit, or he didn’t know, which would demonstrate his inability to get his hands around activities at his own company. It’s hard to say which interpretation makes him look worse. Either way, he should have been cast out as part of the settlement — and the Wells Fargo board of directors should have followed him down the oubliette.”
Because of these actions by the bank customers were fraudulently charged fees for accounts they never opened. They also saw their credit ratings fall and received credit cards they never asked for.
Under questioning Elizabeth Warren got the banker to admit that not a single dime of the money was paid back and not a single senior banker was fired.
“This just isn’t right. You squeezed employees to the breaking point” solely for the purpose of driving up the stock price and increasing your pay-out. You went on television to blame thousands of $12-an-hour” workers.
It’s gutless leadership.
The only way Wall Street will change will be if executives face jail time” for their criminal behavior.”
This banking scheme was corrupt. And watching the attack dog Elizabeth Warren go after the CEO was a thing of beauty.
Elizabeth Warren was being Elizabeth Warren. And we love her for it!