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Except that Wells Fargo found out a long time ago. The article states that they fired 5,300 people over the last few years. However, notice that there was not a single indictment of an employee. Meaning, Wells Fargo swept it under the rug and didn't report their employees to the proper authorities.
If Wells Fargo was an individual they would be charged with a third degree felony based on the employees crime and them willfully failing to report it. I'm only speaking from the viewpoint of FL state law (to illustrate a point about Corporations never facing any real consequences for their actions). Then that individual would be a convicted felon, do some time, have a criminal record as a felon and be on probation after their jail/prison sentence is over.
But of course since Wells Fargo is big corporation so they are allowed to get away with murder. The "huge" fine of $190 million is a joke. They literally paid a .076% fine (based on their total value) for helping to hide thousands of felons who committed hundreds of thousands of felonies. For those of you that want a individual example that's equivalent to how Wells Fargo was "punished:"
-If someone helped a non armed robber hide from the police they committed a 3rd degree felony in FL punishable by up to 5 years in prison.
-However, if his penalty was calculated by "big corporation punishment guideline" and he was wealthy enough to have $100K sitting in the bank; his punishment would be paying a $76 fine. That's .076% of $100K for those of you wondering where I got that figure from.
Criminal penalties from our justice system for individuals running big corporations is non existent. They are literally untouchable and this story is just another blatant example of that. If no one from HSBC went to prison for helping launder drug money for cartels what do you think the chances are of anyone from Wells Fargo going to prison? I will gladly take you up on that wager
Good post. I think I misunderstood some of the initial info. The actual damages average less than $1000 and the money benefitted Wells Fargo and wasn't like an actual embezzlement. So then it gets stickier about whom and what to charge people with.
Meaning if people had sales incentives and were cheating on them I'm trying to think what level of fraud that might be. Probably not felony.hmmm
More Wells Fargo employees need to go but the unemployment rate would drop to the lowest since the great recession from the unemployed and unemployable WF employees. On their resume it should say "I committed fraud". Firing 5,300 over fraud, that’s a lot of bad people in one place. Chastised Wells Fargo with lending sanctions like in 2012. Wells Fargo needs some new horses to pull the aging stagecoach.
Good post. I think I misunderstood some of the initial info. The actual damages average less than $1000 and the money benefitted Wells Fargo and wasn't like an actual embezzlement. So then it gets stickier about whom and what to charge people with.
Meaning if people had sales incentives and were cheating on them I'm trying to think what level of fraud that might be. Probably not felony.hmmm
Your absolutely correct. It will probably get sticky because of the statute of limitation, 5,300 individual circumstances and methods used by individuals to defraud. However, most of the laws I know treat fraud related to a financial institution as a felony regardless of the amount defrauded.
Here in FL the employees would be charged with a 3rd degree felony. Sentence is up to 5 years in prison. Obviously, they will let the bank go scot free but if they were charged as an individual as an "accessory after the fact;" for this particular crime they would also be facing a 3rd degree felony:
Your absolutely correct. It will probably get sticky because of the statute of limitation, 5,300 individual circumstances and methods used by individuals to defraud. However, most of the laws I know treat fraud related to a financial institution as a felony regardless of the amount defrauded.
Here in FL the employees would be charged with a 3rd degree felony. Sentence is up to 5 years in prison. Obviously, they will let the bank go scot free but if they were charged as an individual as an "accessory after the fact;" for this particular crime they would also be facing a 3rd degree felony:
So maybe a few states may charge it as a misdemeanor but I believe most states will have penalties similar to the above.
Great post. Thanks, I learned a lot.
There may not be any one big fish that they can pin this on....just systemic cheating by employees to make goals and of course some of the management would be aware too.
At that point is the cost to the state and benefit of trying to jail 5300 people due to WF's poor internal controls worthwhile use of state\fed resources? Sounds like they decided "no".
I'll add WF to BOA on my list of businesses I'll never work with...vote with my wallet so to speak.
This is what happens when companies put pressure on people to meet quotas or else. Not making excuses, but Wells FARGO is the one to blame.
Exactly, WF (and other banks that do similar) are incentivizing the wrong things.
As soon as management says "you'll be rewarded for doing X", you can bet employees will try to game their X numbers. In this case, it led to outright identity fraud.
Cannot say I'm surprised. Was a WFB customer from 1991-2009, with a checking, CD, deposit box, Visa and MC with them. Was quite happy until 2008, when they made several mistakes affecting my accounts, which cost me money.
In 2009, I went to one of their branches and closed everything, in frustration. Branch manager did not even care or try and retain me.
They get an "F" from me for everything, complete fail of a company.
But all we need is government regulators to get out of the way, and cut taxes on big corporations. Those businesses will then do what is right by customers and employees out of the kindness of their hearts, make lots of money, and that money will trickle down to everyone else and create a job for everyone who wants one!
This quote should be a sticky in the economics forum
Repped
As an IT security consultant, it doesn't surprises me however I don't get why it's announced or leaked out. Because most banks like them finds and catch people doing this all the time and that's why I still have a job.
Hundreds of accounts are flagged for review monthly and good % of them are fake ones. I don't know the scale or scope of the crime. If it's random employees it's rather normal but shows poor management. If it's coordinated to some degree then it needs some major reorganization to get rid of all syndicates.
All this occurs at all major banks but not on the 11 o'clock news.
Was told by an NYC cop about 20yrs ago that banks in NY get robbed a lot, just run out and get on the Subway. If they reported on them and people found out how many never got caught, there would be more.
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