OK, kids, we know how you are. You like to have nice happy posts at the end of the day, and you like it when Sen. Elizabeth Warren yells at people. Well, goldurnit, she did some yellin’ on Tuesday! In case you didn’t hear, Wells Fargo CEO John Stumpf got his ass dragged in front of the Senate Banking Committee, over the scammy “fake accounts” scandal what’s gotten Wells Fargo in big trouble mister recently. Do you need a quick primer on that?
Here, from the Los Angeles Times:
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.
Again, Stumpf still has his job. Tolstedt is on her way into retirement with over $100 million in stock options, and probably candy canes and unicorns and as many ponies as she wants. If you feel we’ve set the scene for you, and you just want to watch Elizabeth Warren stomp balls for almost 18 minutes, please proceed to the video.
If you want more background, read the entire piece from the L.A. Times, check out this letter Sen. Warren wrote to Mr. Stumpf, and then do a little Googling on “cross-selling,” which refers to trying to get your customers to have as many different types of accounts with you as they can. There is normal cross-selling, when your bank says, “You are a very good checking account customer, would you like to open a high-yield savings account with us, or maybe a nice credit card?” And then there is an insane kind, where low-level Wells Fargo employees were reportedly pressured to sell EIGHT services to each customer, which led to the #scandal of opening millions of fake accounts to hit those sales goals.
Now that you have enough information — and really, Warren’s questions seem designed to help the layman watching at home understand what’s going on — you may watch Elizabeth Warren STOMP SOME FUCKING WALL STREET BANKSTER BALLS: