How Can Anyone Keep Their Money at Wells Fargo?

Manderson, WY   On Wyoming maps there are various stagecoach routes that are marked not far from the Silver Bullet’s location on the Bridger Trail. Stagecoaches, the Pony Express, and other ways of delivering the mail are so 1800s. Sadly, for some the only knowledge they may have of a stagecoach is the symbol still used by the banking giant Wells Fargo. If anyone was still manufacturing stagecoaches they would have solid grounds for a lawsuit against the bank for damaging their brand. As one story after another emerges from the gruesome bowels of the bank, I can’t help but wonder, how can anyone keep their money at Wells Fargo?

Just this week there were another handful of grim revelations by the bank.

Wells Fargo said in a regulatory filing that its review of potentially unauthorized accounts could reveal a “significant increase” in the number of accounts involved, up from the 2.1 million that it previously estimated. Wells Fargo said it had expanded its investigation to add three years to its review period, which covered accounts opened from 2011 to mid-2015. This scandal has engulfed the bank leading the fall of one chief executive already, the clawback of bonuses from the CEO and other executives, and, oh yeah, the firing of thousands who participated in schemes where they opened accounts without permission, often closing them quickly as well, in order to make sales and income goals in a boiler room from hell operation.

Just for good measure it seems, the bank also revealed that the Consumer Financial Protection Bureau is investigating whether they harmed customers by closing accounts when there was suspected fraudulent activity and doing so unilaterally without investigation. Hey, we all know their policy now: easy open, quick close, the customer be damned.

That’s not all of course. ACORN fought them for years over the issue of predatory lending winning a begrudging settlement and a gag order mainly for our California members. Others have sued them in recent years for discrimination in lending and of course who can forget the billions they paid along with other members of their tribe for sketchy securitization of mortgages.

Not enough for you yet? How about this one?

Wells Fargo with headquarters in San Francisco, California, a state with a significant Hispanic population, was just slapped down by a federal judge when Wells and its lawyers tried to argue that they had the right to discriminate. Yes, you’re hearing me correctly, the right to discriminate.

A federal judge shot down an argument from Wells Fargo last week that banks can discriminate against applicants, in certain cases, based on immigration status. The class-action lawsuit, brought by the Mexican American Legal Defense and Educational Fund, concerns six DACA recipients, more commonly known as “Dreamers,” who were denied student loans and credit cards from Wells Fargo because of their undocumented status. Are you following me, under deferred action the government allowed them to go to school, work, drive, and live semi-normal lives, but Wells Fargo, believed that despite the DACA relief from the federal government in allowing them to attend colleges and universities, the bank had the right to deny them student loans regardless.

Their culture is one big anti-customer hot mess. It’s not buyer-beware over there, it’s “come into my web said the spider to the fly.” I can’t stop scratching my head in continual wonder as I keep asking myself, “How can anyone keep their money at Wells Fargo?”


Cities and Neighborhoods Catch a Break in Beating Banks

New Orleans   In a rare surprise over the dozen years that conservative US Supreme Court Chief Justice John Roberts has run the nation’s highest court, he joined the four more liberal justices on an issue, delivering a 5-3 vote. Even more shocking the decision was a slap in the face to big banks, in this case Bank of America and Wells Fargo, on a complaint brought by the City of Miami. The court ruled that Miami had standing to sue and to further pursue its claims concerning the discriminatory lending practices of these banks and their allegation that such practices led to decreased property values in neighborhoods, and therefore reduced property tax revenue to the city as well as increasing blight in the community.

This is big, really big, because it powerfully opens the door to a broader interpretation of the Fair Housing Act and its prohibitions against racial discrimination in preventing different standards between one neighborhood and another in cases like redlining, but it also speaks to differing and discriminatory standards in mortgage lending because of income as well, which was at the heart of broker driven exploitation that fueled abuse and outright fraud in the subprime market. There can’t really be too much doubt that Bank of America and Wells Fargo didn’t pause to even take a breath in lower income neighborhoods as they altered their supervision and standards willy-nilly to drive volume on refinancing as well as new purchases much as often as new purchases. Wells Fargo has already become poster child for not supervising its sales staff, but neither does the record of Bank of America and Wells improve when examining the way that they mishandled mortgages underwater during the Great Recession, exacerbating foreclosures.

There’s settled evidence that property values decrease when homes are abandoned in communities, and foreclosures in Miami and other cities led to increased abandonment. The scandalous disregard that big banks showed in refusing to modify the mortgage terms to prevent foreclosures as well as paying little attention to managing and maintaining the properties where they were foreclosing directly lowered values in those properties and whole neighborhoods. Miami has the lead role in proving this now that the Supreme Court has sent the case back down to Atlanta and the 11th Circuit Court of Appeals, and clearly the odds are still stacked against the city and favor the banks, but the door is open and common knowledge and a drive-by to any lower income community establishes the facts on the ground.

The banks are hoping they can prove that they were just one of many crooks, and not the ones pulling the trigger to rob the neighborhoods of their value. In criminal courts this might be a case where the banks might not get a sentence for murder, but they would definitely do time for manslaughter, because there is no doubt that they hurt these communities and the people who live there, whether they were driving the getaway car, acting as the lookout, or holding the gun.