CEO Stumpf: he pocketed a $200 million
profit from the misfortunes of Wells Fargo
customers that his bank engineered
The account holders were charged various fees for these accounts — accounts that they hadn’t asked for.
The 5,300 Wells Fargo employees who helped commit this fraud were fired, it came out during the Senate hearings. So the guilty were punished, right?
Not so fast. Senator Pat Toomey of Pennsylvania noticed a slight, umm, flaw in the testimony of Wells Fargo CEO John Stumpf.
As American Banker reports it, Toomey said, “When thousands of people conduct the same kind of fraudulent activity, it’s a stretch to believe that every one of them independently conjured up this idea to commit this fraud. Doesn’t it defy comon sense to think there wasn’t some orchestration of this?”
And who might be leading the orchestra? Senator Elizabeth Warren had a clue. She said to Stumpf:
“While this scam was going on, you personally held an average of 6.5 million shares, and the share price went up by $30, which translate into more than $200 million in gains [for you].”
And make no mistake. The people in whose names those accounts had been fraudulently opened got hurt. The American Banker story reports:
Stumpf also appeared unready for questions about how customers' credit scores would be affected by the scandal. Sen. Jon Tester, D-Mont., said the impact on customers went beyond fees and fines because account openings could harm credit scores."What about the folks that may have got a house through Chase and paid a higher interest rate because of that?" Tester asked. "The truth is there are real-world implications here on young families and old families that are going to be put in a poverty situation because of that."Stumpf did not respond how the bank would address the situation, saying "we have more work to do.”
Stumpf’s testimony waffled on and on, back and forth, while he seemed to be absolving himself from any obligation to repay the ripped off bank customers. He had found 5,300 little people to take the fall for him, which was no big deal, Stumpf appeared to be saying, because those 5,300 out of work suckers were only one percent of the bank’s employees.
Senator Warren at one point nearly went ballistic, and fired cannonballs of righteous rage at the evently crooked bank president.
“You should resign,” she said. “You should give back the money you took while this scam went on, and you should be invetigated by the Justice Department and the Securities and Exchange Commission.”
I beg to differ, Senator Warren. He should be indicted by the Justice Department. And if he is found guilty — and I have little doubt that if competently prosecuted he will be found guilty — he should do some time behind bars. How much time?
Well, I wouldn’t want to subject him to the harshness of drug laws that have put some casual pot smokers in prison for decades or more for a single act of possessing or selling a few ounces of marijuana. No, I would not.
Instead, I think he should be prosecuted for each specific act of fraud. For each count on which he is found guilty, he should be sentenced to, oh, let’s be very lenient here — say one measly month in prison, sentences for each act of fraud to be served consecutively, of course. Now let me just, umm, tally this up….
Two million victims means two million months — those months divided by the 12 months in a year equals 166,666 years. (Not at all harsh considering that if you’d been tried for personally defrauding the bank that many times, not to mention that many drug sales, you’d be in prison for eternity plus a half million years.)
Heck, with time off for good behavior, betcha Stumpf could be out of the clink in less than 80,000 years. I know that may not sound like enough to people who’ve had their credit ruined, who didn’t get jobs or saw their careers wrecked because they had lousy credit,who couldn’t get a house because they had lousy credit, or who may be homeless today as a consequence of the scheme that put $200 million in Stumpf’s personal pocket.
But as I said, I believe in leniency.