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The Robber Bank: Can America Ever Rid Itself of Wells Fargo?
- BitwiseFool 7y agoI'm doing my part by not having an account with them.
- rolltiide 7y agoI have 8, they are my goto for getting access to the global financial system the most exotic entities Everyone needs a criminal bank, this one’s relationship with the Federal government will not wane Have fun dealing with actual compliance departments, its your time and your life.
- Someone1234 7y agoIs it wise to admit you're committing crimes on HN?
- rolltiide 7y agoPresumes I'm committing crimes. Most banks are skittish and provide lackluster services because they aren't sure about their relationship with the Federal Government. Wells Fargo will do anything whoring for yield, because they can. Everyone trying to 'de-platform' them is misguided.
- duxup 7y agoYeah I left years ago. It's telling that they have since sent me 3 different checks for what I think were significant amounts ... for 3 different scams they ran while I was a customer... 2 I had no clue about until they sent me the check.
- sixothree 7y agoWasn't that part of their crime, creating accounts for people without their knowledge?
- santoshalper 7y agoAs far as you know.
- tstrimple 7y agoI've tried, but I've had two mortgages sold to Wells Fargo without any choice on my part so I keep getting stuck dealing with them.
- SpicyLemonZest 7y agoThe article's lead is a lie. Slate reports that "$3 billion represents only a small part of the bank’s takings from just this one scam", but that's simply not true - as they quoted (!!), Wells Fargo was only accused of taking millions. (The Warren quote they pointed to seems to also be a lie, but I guess it's plausible that she has some principled reason for thinking that $12 billion of profits are "from" the fake account scam even though they're not directly taken from customers.) This doesn't fill me with trust that the article's other examples of misconduct are reported honestly.
- anon102010 7y agoNo kidding - this is some pretty terrible reporting. These account openings were no where NEAR that profitable. The big whales (business accounts, high net worth etc, lending, borrowers) really did not represent in these account openings. I was actually a customer at time, they opened an account, I logged on, saw it, asked them to close it. In my case they tagged the opening onto a different account opening. But was super easy to clean up for me. I'd be curious how folks are getting a $12B profit from these account openings which were low / no balance in many cases
- wyxuan 7y agoThese figures include fraud committed by various other divisions, it's just that the bank accounts portion was the most visible form of this fraud. I believe their forex and precious metals desks were some examples of divisions that committed fraud.
- deleted 7y ago[deleted]
- TuringNYC 7y agoThe article seems vague (like when one is too lazy to do real research and so things are kept wishy washy.) However the key paragraph was this: >>> Warren has been fighting Wells Fargo’s misdeeds for more than a decade, as she reminded Nevadans at the Democratic primary debate on Feb. 19, harking back to a 2008 meeting with Las Vegans who’d lost their houses in the mortgage crisis. https://www.investopedia.com/terms/r/robo-signer.asp https://www.investopedia.com/terms/r/robo-signer.asp https://www.marketwatch.com/story/us-breaks-down-93-bln-robo-signing-settlement-2013-02-28 https://www.marketwatch.com/story/us-breaks-down-93-bln-robo... For those not familiar with this scandal, the banks signed false legal documents attesting to reviewing documents which in fact they had not. Real reviews would have revealed errors in some cases. Accordingly, hundreds of thousands of foreclosures were unjust. However, without adequate legal funds, homeowners could not fight the foreclosures and ended up losing homes w/o cause in many cases.
- exabrial 7y agoNot defending Wells Fargo, but there's a quite a bit of fiction mixed in with facts in this article; More of a hit piece on Warren Buffet and an informercial for Elizabeth Warren.
- busterarm 7y agoBuffett isn't exactly the cleanest financier out there. His company is famous for owning the space of predatory finance options for low-income Americans. He's specialized in it, in fact.
- afiori 7y agoThat is not a relevant reply; I can say that Hitler was a cannibalistic child-eater and for how much he would deserve the insult it remains false.
- buzzerbetrayed 7y agoSo are you saying his claim is false? I really don't care if his claim is insulting or not. Just if it is true.
- afiori 7y agoNo, I am saying that it was not a reply yo anything said in the comment. exabrial was noticing how the article was clearly biased; whether Buffet "deserve" that bias due to other negative traits is relatively irrelevant. Honestly it is a pet-peeve of mine. Person A has bad trait X and so person B claim that it also has bad trait Y without the required links or justifications. Remaining in the misjudged Nazi example, it is important for me to criticize the horrors of WWII for what actually happened, because every unfounded criticism will come back to bite you.
- sumedh 7y ago> More of a hit piece on Warren Buffet Do you really think Buffett does not know Wells Fargo is running a huge fraud, he has been through an another type of fraud when he had invested in Solomon many years back. he knows how rotten the banking industry is.
- citiguy 7y agoThis is a puff piece for Elizabeth Warren.
- HumblyTossed 7y agoFat lot of good it is going to do, right?
- mbreedlove 7y agoYou're completely right. > Sen. Elizabeth Warren, whose incisive and relentless questioning led to the resignations of not one but two Wells Fargo CEOs in connection with the scam, was not impressed with the announcement. > Warren has been fighting Wells Fargo’s misdeeds for more than a decade > Last month, banking regulators reported that John Stumpf—Sloan’s predecessor, whose nose Warren bloodied so effectively back in 2016 > A picture captioned "Sen. Elizabeth Warren questions Wells Fargo CEO John Stumpf" > After Sen. Elizabeth Warren mopped the floor with onetime Wells Fargo CEO John Stumpf > Sen. Warren demanded answers from the bank > Warren’s popularity grew in no small part because of the effectiveness and vim with which she socked it to Sloan in October 2017
- throwawaysea 7y agoWhy should we be "getting rid" of Wells Fargo? That part isn't clear to me. The magnitude of the false accounts was relatively small. There are probably worse things happening in the banking world. Is there such a focus on this because it is easy to understand relative to other complex issues in the financial world? Or is this just a piece to advertise for Elizabeth Warren? When I see phrasings like "Sen. Elizabeth Warren mopped the floor..." it comes off as unprofessional and nakedly biased reporting, rather than factual reporting.
- treyfitty 7y agoWells Fargo and American Express have a close knit history. As a matter of fact, Butterfield Wells and Fargo were founders of AmEx. It’s no surprise AmEx was caught doing the same thing: https://www.wsj.com/articles/amex-staff-misled-small-business-owners-to-boost-card-sign-ups-11583074800 https://www.wsj.com/articles/amex-staff-misled-small-busines...
- philwelch 7y agoWhile true, the Wells Fargo company that Wells and Fargo founded was taken over in 1998 by Norwest, which ended up rebranding itself as Wells Fargo.
- HumblyTossed 7y agoHow can we reconcile this with still sending men to prison for 5 years for selling dime bags of weed on the corner? Seriously, who's the bigger criminal here? I get it, companies aren't people, blah blah. But people make these decisions and those people should be punished.
- SpicyLemonZest 7y agoI tend to agree. But the criminals who opened the fake accounts were overworked low-level staffers with unrealistic sales quotas, so they're very sympathetic. I don't think I've seen anyone even suggest they should be prosecuted; the discussion has largely focused on their bosses and Wells Fargo as a company, who fired them when the fake accounts were discovered.
- HumblyTossed 7y ago> But the criminals who opened the fake accounts were overworked low-level staffers At who's direction? How does low-level staffer at WF#1167 know low-level staffer at WF#2826 2200 miles away? When would they share the information that this is how you up your numbers? Upper management had to know. They had to have encouraged this.
- SpicyLemonZest 7y agoEven if that's true, and I think it's important to note there's no known evidence for it, being asked to commit a crime doesn't normally diminish your culpability for it. If your boss tells you to open a fake account, you're obligated to say no, just as you would if your boss told you to go punch someone or steal their wallet.
- zentiggr 7y agoOn the other hand, under the UCMJ generally subordinates that are forced into compliance with unlawful orders are not punished anywhere near as harshly as the superior officers that cause the situations. Not that any institution gets it right or is spotlessly incorruptible, but the general direction of UCMJ actions is the good of the service, not just being punitive.
- travisoneill1 7y agoRight now I am trying to rid my business of Wells Fargo. They are charging us $700 / month for services that would cost me around $200 from PNC. Their pricing is so convoluted that it is impossible to understand, and their reps take advantage of that. They quoted me an estimate of an additional $60 / month to add positive pay verification for checks, but my bill went up $300. And just to add insult to injury, they charge $1 for every time I need to run a search on our account records. Oh and I amlmost forgot to add, I was locked out of our account for a few days because of a rule change. I made the mistake of using them out of convenience because my personal account is with them. Don't make the same mistake as me. When you start a business avoid Wells Fargo like the plague.
- edoceo 7y agoTook my business almost five years to exit relationship w/WF (only a few months ago). Banks are super-sticky. But grind that process homie!! Once my account at WF closed I noticed the sun was brighter and I smile more often.
- brogrammernot 7y agoI’d take a look at SVB, Brex and others (PNC is good as well) depending on what you need the business account for. I have one with Chase and haven’t had any issues but it’s a small account anyways so might not apply for you.
- mikekij 7y agoI second this. We used Wells Fargo through our angel and seed rounds. Switched to Silicon Valley Bank after our A, and wish I could go back in time and use them from the start.
- blackearl 7y ago> they charge $1 for every time I need to run a search on our account records This alone would annoy me to the point of closing the account. Absolutely zero reason for this in this day and age
- Mvandenbergh 7y ago"But that $3 billion represents only a small part of the bank’s takings from just this one scam—customer money to which, by its own admission, it “was not entitled.”" This is totally incorrect. The best estimate of how much money was made from the fake accounts scandal is... about $2m gross. That's for a pretty obvious reason which is that it is very hard to secretly charge people money and very easy to secretly open an account for them which then goes unused. Essentially, WF did not really profit from this, it was the employees and officers who were fleecing the company and fraudulently opening accounts to do so. Branch employees were incentivised to sell products like accounts and cards to customers on the theory that WF profited from such sales. Compensation for the employees was set based on an assumed / historical profit per cross-sold product. Senior management had incentive packages that were also based on that assumed link. But of course that was calibrated based on real accounts. Shadow accounts that are setup but not used by the customer (because they don't know they exist) do not and cannot produce profit for the bank. What the bank would have seen over time was number of products sold going up but profit per product going down. Since the former is a leading and the latter a lagging indicator, it can be a long time before that becomes apparent. From the point of view of WF, this was the dumbest possible fraud because it didn't make them money. I bet that $2m in account opening fees actually comes from the less experienced crooked branch staff because it seems like a rookie mistake that would lead to you getting caught. Of course there is no such person as "Wells Fargo", and from the point of view of the branch and management employees whose compensation depended on these cross-sales numbers, the scam worked just fine until they were caught.
- tantalor 7y agoSemantics. Taking (income) and making (profit) are different things. Both are true: WF took $3b, WF made $2m.
- Mvandenbergh 7y agoWhere does the 3bn come from though? I'm saying that the gross revenue was $2m. Is the 3bn total damage to customers including credit score hits?
- NoblePublius 7y agoI was a victim in 2007 of Wells Fargo’s tactic of re-ordering debit transactions from largest to smallest to maximize overdraft fees. I remember screaming at a bank manager about this practice that he claimed he could do nothing about. I closed my account that day and put my savings into a credit union across the street.
- deevolution 7y agoWhen will corporations, which are effectively treated as people, be placed in jail and or executed?
- ehvatum 7y agoInteresting. I quit Wells Fargo last week to focus on my machining business. I would have stayed on if they let me work remotely - it took at most 15 minutes a day to do my c++ coding job. But, seeing as how it took 4 months to get Python3 installed, and the SSD and 128GiB memory upgrades for my desktop were apparently stolen from the “IT Workroom”, getting a laptop seemed like a bridge too far. I felt a little bad about quitting, but WF fires tens of thousands of people at a time for no apparent reason...