Greedy Lawyers Victimize Hard-Working Bankers

  the american way

If you lived here you'd be out of your home by nowThis week, grasping racist trial lawyers (aka Obama’s base) massacred our nation’s most important job creators, predatory bankers. Gubmint lawyers (conflict of interest, much?) announced a $175 million settlement to be paid by the Wells Fargo Stagecoach & Freight Haulage Co. to a bunch of ungrateful blahs and Messicans who were granted the great privilege of sub-prime loans by one of Wells Fargo’s more predatory subsidiaries (like that is even Wells Fargo’s fault). Turns out these borrowers were “qualified” to receive ordinary loans with lower fees and interest rates, just as if they were regular Americans, but didn’t because, duh? Look at them.

Wells Fargo paid the settlement while admitting no wrongdoing in the matter, a company spokesman said*, because, “Hey, we sweep up that kind of change out of the couch cushions on an average Thursday,” unquote.* The settlement in part will provide down-payment assistance to borrowers in the areas “victimized,” the stereotypically racist enclaves of Alabama and Mississippi San Francisco and California’s Inland Empire.

The LA Times noted that this was a case of just one, rare bad apple in an otherwise pristine barrel of vital financial services:

The $175 million total is the second-largest fair-lending settlement by the civil rights arm of the Justice Department. The largest, reached in December, requires Bank of America Corp. to pay $335 million to settle claims against Countrywide Financial Corp., the aggressive Calabasas, Calif., lender it acquired in 2008.

Another former Wells Fargo unit – the now-defunct subprime storefront lender Wells Fargo Financial Inc. – was the target of a separate investigation by the Federal Reserve. Wells Fargo agreed last year to pay $85 million to settle allegations that Wells Fargo Financial employees improperly pushed borrowers into more expensive subprime loans and exaggerated income information on mortgage applications.

See? The system works.

*Not an actual quote. [LAT]

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81 comments

  1. sati_demise

    "Wells Fargo paid the settlement while admitting no wrongdoing in the matter"

    These fuckers should be in jail. Sell off their assets to pay for their lodgings.
    Jail and liquidation is the only way to stop this shit.

    1. valthemus

      Umm… jail… sure… I guess that's more likely to happen than my idea (involving rabid weasels and peanut butter smeared on exposed testicles).

      1. new_pic_for_NEWTer

        Huh, who knew weasels liked peanut butter; and also; are you sure the real weasels wouldn't show professional courtesy to the banking weasels?

      1. BerkeleyBear

        It is standard practice to negotiate that with the government if you can because otherwise the admission counts against you in a civil suit, turning a likely to lose case into a no way in heck to win. The government is normally willing to do that much if it means getting a few more bucks in the penalty and not taking the risk of going to trial (because even if they won, the cost might eat up a big chunk of the penalty and take years longer). Trust me, you'll see plenty of recruiting ads in the impacted areas from attorneys taking the civil cases and riding along on whatever the Feds had in the way of evidence.

    2. Jukesgrrl

      $185 million to Wells Fargo is like $1,850 dollars to me. I'll wish I had it for the new blinds I want to buy but, otherwise, it will be business as usual around the house.

    1. C_R_Eature

      If you do come around, don't worry about the naked man in the tree. That's just Yossarian.

  2. ManchuCandidate

    But the Free Market Invisible Hand! It gives everyone hand jobs equally regardless of race, creed and income.*

    *Disclaimer… Free Market Invisible Hand does not exist and not a real economic variable that gives out hand jobs. Only used by deluded Asperger type assholes and enablers to justify their or others actions.

    1. Biel_ze_Bubba

      Oh, it's real enough … but often, instead of a hand job, you get an invisible fist up the ass. It mostly depends on how rich and connected you are.

      1. flamingpdog

        I read somewhere recently that they're thinking of dropping Asperger's from the new DSM-V. I could have teh sadz because, heh heh, ASSBURGER'S.

        1. ASHLEIGH_Joe

          Honestly, as a psych major, and also speaking from personal experience, I'm kinda happy to see it go.

          Most of the "differences" between Aspergers and any other Autism spectrum issues are literally the difference between having autism, and having autism and being a genius and being able to use that intellect to compensate for your deficits. And the ones that weren't were imaginary anecdotal differences that psychologists projected onto the two groups once they started working from the assumption that they were materially different. Actual well-controlled studies of high-functioning Autism and Asperger's have all but demolished the idea that there's a real distinction there.

          Agree with you on the name, though. German names are so silly!

      2. ASHLEIGH_Joe

        Seriously, let's not confuse Aspergers with Sociopathy. Aspies actually have empathy for other people, and are genuinely distressed when they misunderstand something about human behavior. They're prone to making incorrect assumptions and simplifications of human behavior that might leave them a tad prone to buying into this stuff, but that's a bug, not a feature.

        Sociopaths, by contrast, really don't give a fuck about other people, as long as they get what they want. Sociopaths love to invoke the Invisible Hand of the Free Market, while non-consensually fisting anyone they can with it.

        1. redarmyzombie

          True that. I was diagnosed as a kid with low-spectrum autism, and I tell you, it SUCKS!

          1. ASHLEIGH_Joe

            Heh, same here. I find it honestly crazy that I'm not even 30, but this makes me one of the older people to get a diagnosis as a child.

            Of course, it meant that my school system had no fucking clue how to deal with me, it was like all of my other being-the-eldest-child issues, writ large.

  3. coolhandnuke

    This fiduciary sleight-of-hand is known as Catch-88 in the financial world–Major Major Major Major.

  4. EatsBabyDingos

    This from the company that bought Wachovia: Sub-Prime Motto in 2008: "We don't just knock you down. We Wachovia. Fool."

    1. Butch_Wagstaff

      There's still branches of Wells Fargo (formerly Wachovia) still hiring tellers here. See? They creatin' jobs!

      1. Spurning Beer

        Before I heard the name pronounced, I thought it was like 'watch over ya'." Seemed reassuring

        Then I heard the real pronunciation, "Walk over ya'." Yikes.

  5. ASHLEIGH_Joe

    In other Racial Trancendence news, this.

    It really bears repeating, that the year is 2012, not 1972, and this shit is happening, today, in America. And not even the Confederate parts.

    But racism must be over, because we have a black president.

    1. Negropolis

      The lawsuit, filed in Federal District Court in Santa Ana, Calif., includes a copy of a March 2009 e-mail sent by the company’s then senior vice president for store operations to lower-level managers after she had inspected several stores. The email said, “African American dominate — huge issue.”

      One plaintiff, Nicole Cogdell, the African-American former manager of a Wet Seal store in King of Prussia, Pa., said the company terminated her the day after that e-mail was sent. She said that she had heard the senior vice president, Barbara Bachman, tell a district manager that she wanted someone with “blond hair and blue eyes.”

      Oh, god.

      1. bibliotequetress

        Sorry, need help wrapping my head around this.
        1) Wet Seal Corporation has problem w/ fact that their own stores have hired Blacks, who, apparently, are doing the work successfully or they would have been fired already
        2) Wet Seal, at least where I live, largely markets heavily to teen/young Black women
        3) So, obviously, Wet Seal has no money taking money from Black women, however…
        4) Has a problem paying Black women

        What… how… I DON"T UNDERSTAND

  6. Biel_ze_Bubba

    Meanwhile, poor bank JPMorgan Chase disclosed on Friday that losses on its botched credit bet could climb to more than $7 billion — and that the bank’s traders may have tried to obscure the full extent of the disaster. The company announced that its earnings for the first quarter were no longer reliable and would be restated. Federal regulators are now looking at whether employees of the bank intended to defraud investors.

    No word yet from GOP lawmakers on how they will make this easier for Jamie Dimon. Experts have expressed doubt that more blow jobs from Spencer Bachus will be sufficient.

  7. JohnnyQuick

    Sing!

    ♪♫ Oh, The Wells Fargo Wagon Is A-Coming Down The Street,
    Ripping Off Those Damn Mi-nor-i-ties ♪♫

  8. Biel_ze_Bubba

    "Another former Wells Fargo unit – the now-defunct subprime storefront lender Wells Fargo Financial Inc. – was the target of a separate investigation . . . "

    Methinks there's more than one bad apple in that stinky barrel.

    1. Willardbot9000_V2.5

      Wells Fargo Financial no longer exists as a seperate division because it was reorganized to in-house with the usual financial sleight-of-hand bullshit at work. Wells Fargo Financial products do very much still exist…this is what I love about this sort of game: people (mostly wingnuts) try to pretend the moment the offending division is closed that the counter is reset to zero, so to speak. The reality is, if you're filing for credit for furniture and certain credit cards and auto loans…check the fine print for the lender. There you will find WFF and/or Chase's "non-corporate" lenders…and you'll know you're about to get fucked like a pornstar.

  9. gogogodzilla

    No snark here–my understanding is that corporations can deduct fines like this from their taxes. Which means no fine effectively.

    1. flamingpdog

      I'm not a CPA, and someone can correct me if they know better, but if the fine is deductible, I believe it means that they don't have to pay taxes on the amount of money they spent on the fine. It would be effectively no fine if they got a tax credit.

      This is all assuming, of course, that they pay any taxes to begin with.

    2. BerkeleyBear

      Not really. Punitive fines are not supposed to be deductible, but there's a whole remediation versus punishment distinction that makes me unsure if this particular fine could be claimed as an offset. Even if it is, it doesn't wipe out the penalty to deduct it. The defendant is still out the money for the fine, legal expenses, employee time spent on the litigation (not deductible directly) and all the money it spent to make the 175 million dollars in the first place (also not deductible directly). So assuming that means the total cost of this litigation is 190 million or so (just guessing, some accountant would probably put it higher) and a 20 percent tax rate (typical of major corporations) being able to deduct (not take a credit) even that whole 190 million just means they are avoiding taxes of something like 40 million. It would be nice to nail them for more, but that would arguably make the taxes punitive, which is a problem legally.

      Oh and it is all business related legal costs that can be deducted, not just corporations. It is just that corporations can't commit personal crimes like human beings do.

      1. DustBowlBlues

        I'm exhausted and this comment is making my head explode. I take it you are one of those lawyers in the Ds base.

      2. Biel_ze_Bubba

        At the end of the day, though, it's the shareholders who get screwed. The executives who committed the not-admitted-to crimes cash their paychecks and collect their bonuses as if nothing happened, or at worst depart — with a huge golden parachute — to "pursue other interests."

        Of course, if the crooks are low enough on the corporate food chain (middle management or below), they might get the boot, or even get fed to the prosecutors. Corporate image, somehow, becomes much more important in those situations.

        1. Veritas78

          A good reason not to own any financial stocks whatsoever, and to keep what assets you might have in a credit union, mutual loan society, or other soshulistic depositor-owned institution. They're out there, and quite easy to find, what with the internets and all.

    1. ManchuCandidate

      Because the managers and assholes who ran this scam aren't being lined up and shot, their possessions and monies confiscated and the rest of the bank drowned in a tub like they really deserve.

      1. flamingpdog

        Maybe we need to adopt the Grover Norquist strategy of making the banks so small we can drown them in a bathtub.

  10. SorosBot

    That's nice. Now, when do we get to see these banks' CEOs and Board of Directors members actually go to jail for what they did?

    1. mrpuma2u

      I dream of the day that a bank CEO bastard convicted of this kinda shit has to put on an orange jump suit and pick up highway trash.

    2. Willardbot9000_V2.5

      That would be good except for the culture of the executives….whoever is the CEO of these banks was lured in from other companies so that if they are jailed, the bank will just lure someone else in with golden parachute contracts. Ever since Raygun established capital gains as seperate from income CEO's have become mercenary assholes who only care about what the stock is doing now; they don't care for a longview because they won't be CEO for very long. This is just yet another segment of corporate America badly needing reform which won't be reformed….

  11. flamingpdog

    Major x 4: I hope you're not getting paid by the page view after Newell posted his fantastic Obamanator video only 25 minutes after your post. I'm sure teh Wonketeers can scrape up some extra Ameros and hobo beans for ya if you're down to your last package of generic Ramen noodles.

  12. Antispandex

    "The LA Times noted that this was a case of just one, rare bad apple in an otherwise pristine barrel of vital financial services:"

    Yeah, somehow I'm just not convinced we have seen the last of these pedatory…I mean totally misunderstood, financial practices.

    1. flamingpdog

      I thought we were talking about the banksters, not the Catholic church (or Penn State).

    2. bobbert

      "The LA Times noted that this was a case of just one, the latest rare bad apple in an otherwise pristine barrel of vital financial services:"

  13. Callyson

    Actually, 4M, the made up quote is not far from WFB's actual statement–from HuffyPo's article on this crap:

    "Wells Fargo is settling this matter solely for the purpose of avoiding contested litigation with the DOJ, and to instead devote its resources to continuing to provide fair credit services and choices to eligible customers and important and meaningful assistance to borrowers in distressed U.S. real estate markets."

    Meaning:

    "Wells Fargo is settling this matter solely for the purpose of getting this story off the radar of the regulators who just might decide to grow a set for once, and to instead devote its resources to doing a better job at disguising our sleazy business practices."

    *and*

    In addition, Wells Fargo stated it will no longer finance mortgages that are priced and sold by independent brokers. The $125 million payment Wells Fargo has agreed to pay is to borrowers whose mortgages were priced and sold by independent mortgage brokers.

    So, this was all a big misunderstanding…it wasn't us, we outsourced the dirty work to others so that we could deny it later…

    Assholes.

  14. PubOption

    When I first moved to Texas, about 18 years ago, the banks would not consider me for a mortgage because I was on an H1B visa. As soon as I got permanent resident status, said banks were clogging my mailbox with their flyers. I suspect that I was collateral damage from (semi) legal redlining.

  15. DustBowlBlues

    Major Major Major Major (if that's even your real name) thanks for giving us one good news story. To keep my buzz, I'm not going to read or think of all the ways Wells Fargo will walk away from this with no harm, or money ahead.

    So keep writing if you want, legal types. My eyes are shut and I am saying "la-la-la" so I can't hear the anger building in my poor, tired body.

  16. kittensdontlie

    A word to the wise: This lending practice was the first to be referred to as a Mutually Beneficial Arrangement. Also known as, "pull down our pants and bend over, etc…

  17. Chow Yun Flat

    Wells Fargo paid the settlement while admitting no wrongdoing in the matter, a company spokesman said

    We are completely innocent. We didn't do it, we weren't even in town when it happened and we will never do it again.

  18. BenGleck

    They forgot the part where the government made them make (toxic) loans to minorities. _:-} <S>

  19. Plowmon

    I'm suing Target as toilet paper is actually cheaper in the medium-sized 24 roll package but their employee said the best deal was the jumbo 98 roll pack. Of course I couldn't be bothered to do the math and she was really leaning on me to put the big pack in the cart…

Comments are closed.