Wells Fargo’s Business Model is Fraud
Let’s be clear, the business model of Wall Street is fraud. In my view, there is no better example than the recently-exposed illegal behavior at Wells Fargo.
The CEO of Wells Fargo admitted today that he knew in 2013 the bank was scamming customers, but he took no action to fire or reprimand the senior executives in charge of supervising this activity. Instead, they were given millions in bonuses, while the value of the stock that the CEO owned shot up in value by more than $200 million.
Wells Fargo’s abuse of its customers is not an aberration. In April, the bank reached a $1.2 billion settlement with the Department of Justice for ‘reckless’ and ‘shoddy’ underwriting on thousands of home loans from 2001 to 2008. In 2012, Wells Fargo was fined $175 million to settle claims of discriminatory and predatory subprime lending in black and Hispanic neighborhoods.
We have got to end the two-tier justice system — one for the poor and working class and one for Wall Street and the wealthy — that has existed for far too long in this country. The American people cannot understand how major banks paid more than $200 billion in fines and settlements since 2008, but not one Wall Street executive was prosecuted. That has got to change. ‘Equal Justice Under Law’ cannot just be words engraved on the entrance of the Supreme Court. It must be the standard that applies to all Americans, including the CEO of Wells Fargo and other financial executives.
We also must break up Wells Fargo and the other biggest banks which have assets of nearly $10 trillion — the equivalent of nearly 60 percent of our nation’s gross domestic product.
Wall Street won’t change until we make it clear that no bank is too big to fail and no CEO is too big to jail.