In the United States burst high-profile Bank scandal. We all remember about the massive financial fraud in the crisis of the end of the zero inflated bonuses for bankers, manipulation rates, and tax evasion. It now appears that big Bank Wells Fargo has systematically, over many years or even decades, have made illegal transactions with customer accounts, earning millions. The Bank executives refused to take responsibility, turning the hands of ordinary employees.
Never was, and here again
Wells Fargo, unlike other major players in the financial market, focuses on traditional banking services. That is, on loans to natural and legal persons. On the securities market, in comparison with Citigroup or JP Morgan, the Bank is almost imperceptible. And his headquarters is not in new York and on the West coast, in San Francisco.
Against the background of scandals that shook the financial sector of the United States almost continuously for the past 10 years, Wells Fargo Bank looked clean, not involved in some questionable stories. The crisis of 2007-2009 it has survived virtually painless, because it minimized the practice of risky lending and the use of sophisticated trading instruments. It is no coincidence that Wells Fargo is the preferred Bank by billionaire Warren Buffett, who decided in 2009 to invest several billion dollars.
Absolute sterility of the jar to get all the same failed. Less than a month ago Wells Fargo had to pay about 4 million dollars for settlement on the accrual spetsvyplatami student loan. Taking contributions from students, the Bank is providing all necessary information on the account status and thus deprived customers of the ability to minimize costs. For which he was punished.
But it is a trifle on the background that came to light in September. The investigation in the Bureau of consumer protection of financial services of the United States came to the conclusion that for many years without the knowledge of Wells Fargo customers gave them the name of the account (according to different data, from a half to two million) and issued credit cards (more than 500 thousand pieces).
Photo: Rick Wilking / Reuters
Employees of Wells Fargo opened accounts and issued credit cards without the knowledge of customers. Suffered up to two million people
Of course, money for services, which the consumers didn’t know were written off with the very real accounts. At the moment the loss of customers is estimated at five million dollars. But the amount in the course of the investigation is likely to grow.
Criminal cases not yet opened: the Bureau does not have appropriate privileges. However, all the necessary documents have been handed over to the Prosecutor and other competent structures. Bank fined $ 185 million with which he hastily agreed.
However, in comparison with a loss in market capitalization almost nothing — the company’s shares fell by almost 15 percent, which is more than $ 30 billion. The losses of Warren Buffett — about half a billion dollars.
General Director of the credit organization John Stumpf immediately made “organizational conclusions”, dismissing immediately 5,300 people (about one-fiftieth of the employee). But no top Manager was not among them — only the small clerks and their immediate superiors.
Meanwhile, it is doubtful that ordinary employees of the Bank suddenly conspired and launched a fraud of this magnitude.
Therefore, the American public now, as they say, “waiting for landing”, and far more serious figures than the city clerk’s office.
Photo: Joshua Lott / Reuters
Actions like the Occupy Wall Street (“occupy wall street”) is caused by including the actions of unscrupulous bankers
You managed to grab?
Stumpf has said: “the Bank had no intent to cause anyone harm”. Information received from employees of the credit institution proves to the contrary.
So, the New York Post quotes the statements of some former employees of the Bank: “I’ve seen people get promoted because they were willing to do all the shit that wasn’t supposed to do”, “what the Bank was caught, it was an open secret — this was done almost every”.
One of the specialists of the credit institution, does not violate the law, says that not even hope could that work for the Bank as much as was brought by the people, hunted doubtful operations.
Rather, it began before the advent of Stumpf in 2007. Former employees of the Bank on condition of anonymity, talking about the suspiciousness of the transactions even in 2004. In any case the violations were of a systemic nature and associate them with evil will of individual clerks would be weird. Apparently, the leadership or simply turned a blind eye to what is happening, or even actively encouraged the violators.
One of the possible perpetrators of fraud in a press call Carrie Tolstedt, which until recently led the consumer division of the Bank. Just a couple of months before the announcement of the first results of the investigation, she left her post c “Golden parachute” — 124 million dollars in the form of various payments and bonuses, including stock options of the Bank. Although she didn’t do anything to stop fraud, Stumpf called her “a hero of our customers.” It is not excluded that the Bank will partially return funds, inherited, Tolstedt, but no decision on this issue pending.
Photo: Charles Mostoller / Reuters
Amid the scandal cost Wells Fargo plummeted. The Bank fell to 30 billion dollars
Nothing personal
World-renowned playwright Bertolt Brecht once asked the question: “What is robbing a Bank compared with founding a Bank?” Now this question is as relevant as ever. The wave of scandals that swept the global financial industry in the last ten years, shows that the damage caused to the economy by unscrupulous bankers, far more than the usual Bank robberies.
The global crisis, which almost crashed the entire world economy began with the collapse of the derivatives market, which is not fully understood even by their creators. In an effort to earn more bankers have gone to unprecedented risks, which led to a natural failure. The responsibility for this, however, nobody suffered.
Thanks to billions of dollars in state aid, several years after the crisis, banks have returned to what Americans call “business as usual”. Although the appeals judge top managers of the largest banks, or at least to tighten the regulation sounded again.
The interests of customers and business ethics continued to be neglected, as, for example, in the history of the manipulation of the LIBOR lending rate, which depends on the whole world financial market.
History with Wells Fargo distinguished by the fact that the impropriety of the bankers affected ordinary people, which has systematically squeezed the extra penny to improve how its employees and the Bank as a whole. After all, for the mass opening of accounts employees (no matter what level) received an increase in salary, and the Bank of the beautiful figures in the report showing the growth of the business.
Author: Dmitry Migunov
