Skip to comments.Senators Call For ... Wells Fargo As Warren Buffett Vows To Keep Silent Until After Election
Posted on 09/22/2016 4:48:03 PM PDT by Rusty0604
That did not take long. Just hours after a CNN report suggested that Wells Fargo was retaliating, and firing, company whistleblowers who had spoken out against the company's illegal "account creation" practices (while blaming them of being "tardy"), moments ago Reuters reported that Senators have asked the Labor Department to investigate Wells Fargo for potential violations of Fair Labor Standards Act.
To be sure, now would be a perfect time for Wells Fargo's biggest shareholder, Warren Buffett - who owns a 10% stake in WFC - to speak up in defense of his favorite US bank, alas that won't happen. As Fox Business reported overnight, Warren Buffett said itll be more than a month before he publicly discusses the banks phantom-account scandal. Why? He doesn't want it becoming an "election issue."
If I start commenting on that or anything else, it will lead down too many paths so I will wait until November to speak about it, the election or any other subject, Buffett told the Fox Business Network, according to an article on its website.
If history is any guide, Buffett can't be thrilled about the ethics lapse. 25 years ago this month, Buffett testified before a Congressional sub-committee regarding the Salomon Brothers bond scandal. Buffett had become a major shareholder in Salomon when it was revealed that traders had been submitting false Treasury bond bids in order to skirt trading rules.
Buffett swiftly took over as CEO and fired a number of management. At the time, he said during the testimony, "Lose money for my firm and I will be understanding; lose a shred of reputation for the firm, and I will be ruthless."
In retrospect, there appears to have been a footnote there.
As Bloomberg notes, Buffetts silence on Wells Fargo contrasts with his support of executives including Goldman Sachs CEO Lloyd Blankfein and JPMorgan's Jamie Dimon when their companies drew regulatory scrutiny.
The main reason Buffett has entered a media quiet zone is that he is vocally backing the presidential candidacy of Hillary Clinton, a Democrat who wrote in a letter to the banks customers that she was deeply disturbed by Wells Fargos conduct. As such the conflict of interest between Buffett's massive investment, and Hillary's "concern" about Wells' practices, not to mention hypocrisy by her wealthiest backer, would provide the media, or at least a small part of it, with hours of enjoyable questioning.
It really is time to bust up the big banks.
Not if Hillary has anything to do with it.
I agree. The sad thing is the avg. voter sees her as the working man’s candidate. It couldn’t be farther from the truth. A Hillary presidency = the United States of Goldman Sachs.
Trump on the other hand...well... there’s a reason the hedge funds are terrified of him. They know the jig is up if he’s elected.
Phantom Account Scandal Explained:
Bankers get a commission (extra money,) for certain actions. These usually invoice opening accounts. The more accounts you open, the more money you get.
Commission is a bonus. It’s not a requirement for your base salary. Many banks create a quota of sales that they expect their bankers to hit. When accounts are opened with certain products(direct deposit, online banking, etc) is profitable for the bank.
Wells Fargo had an environment, where if your bankers were not making enough commission, they were reprimanded.
Every location has a limited amount of customers. The quotas at Wells Fargo were much higher than achievable.
This is a tactic for any sales force to raise the bar higher to get your team to perform harder.
Unfortunately, the quotas were so high, and the pressure on the employees was equally high, many resorts to illegal actions to achieve those goals.
Bankers opened accounts without the owner’s permission. Credit cards, checking, savings, online banking, bill pay. They would transfer money around to these accounts, simulate the activity that would get them paid, and transfer it back.
The banker hits their numbers, three bank looks profitable, no one thinks about it. This goes on for years, and customers are asking about credit cards/accounts they never applied for.
Keep in mind, when we say bankers, we mean regular employees who make 25k-35k a year before commissions.
This type of stuff isn’t uncommon, but such a drastic breach across the board shows that when you create a highly pressured incentive-based system and punish those who perform poorly, you’ll create a corrupt system.
There was no one looking to see if these accounts were legitimate, they only cared that numbers were met.
>It really is time to bust up the big banks....
....and LONG past time to break-up BIG GOVT (right after the former)
WF is constantly in trouble. One would think they’d have straightened up their act decades ago.
I’ll never use them for the hell they put me through over trying to get new signature cards for a youth group. Another time they wanted my finger print to cash a little $20 check from a relative with the same last name. No way. No how.
I noticed a change at Wells Fargo about three years ago: I was pressured - virtually coerced - into closing an old checking account, and opening a new one. The employee was almost frenetically aggressive.
It was so unwarranted, it seemed almost creepy. I figured at the time that they must have sales quotas; now I suspect that there was a metaphorical gun being held to his head.
Currently transferring Wells Fargo funds to other more honest places. The reason is they are effectively bankrupt per one financial source. That explains the pressure to abscond more money.
Bad money chases bad.
How come Elizabeth Warren never called out Buffet?
Because is is a big democratic donor and supporter?
Wells Fargo is a cancer that needs to excised.
They have perpetrated horrible, immoral crimes against thousands of innocent people, as standard (if unwritten) policy.
They need to go extinct and the officers sent to prison, AT BEST.
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