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How Elizabeth Warren Took Down the CEO of Wells Fargo, and Why It Matters

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Re: How Elizabeth Warren Took Down the CEO of Wells Fargo, and Why It Matters

#41

Post by brazzledazzle »

henrikschroder wrote: post #29
rconti wrote: post #23

Earlier quoted context omitted.

Prison may be a bit harsh. And in a vacuum, you're right. It would be somewhat unfair to drop the hammer, out of nowhere, on some unsuspecting CEO who just did "business as usual". But that's no excuse; it just means we need to create a culture where this kind of thing becomes increasingly unacceptable, so that in the future executives will know what's expecting of them, and what the consequences can be. The "uninten…

> The CEO can't know what every last person in the organization is doing, but they should be incented to make it their business to a culture in place that doesn't permit this Where I'm from, there's a group af crimes such that if an employee at a company does them, the CEO will absolutely go to jail, even if they knew about it or not. For example, if your company produces toxic sludge as a byproduct, and someone at t…

I thought they only have to demonstrate that they took reasonable measures (training, checks and balances, culture, etc.) to prevent an employee from doing something like that. Being a CEO without that protection would be scary.

Re: How Elizabeth Warren Took Down the CEO of Wells Fargo, and Why It Matters

#42

Post by yummyfajitas »

dangerlibrary wrote: post #24
forgetsusername wrote: post #19

Earlier quoted context omitted.

Anyone who has worked in a company of any size knows it'd be down near impossible to know the inner working at all levels of the organization. So, yes, the guy is accountable and needs to lose his job. But the idea that he should go to prison for something like this is ludicrous.

Given the enormous scale of the fraud, someone should definitely be going to prison. "But my criminal organization is very large and not everything we did was illegal" is not an excuse.

Enormous scale? The total fees from this fraud were $2.4 million.

https://www.bloomberg.com/view/articles/2016-09-09/wells-far...

The "excuse" is that a bunch of employees did it against management's express instructions, and that management actually took action (albeit stupid ineffective action) to prevent it back in 2014.

https://www.bloomberg.com/view/articles/2016-09-19/tough-tar...

This is not something that was remotely profitable for WF, this was employees lying to WF to hide the fact that they didn't meet their goals.

Re: How Elizabeth Warren Took Down the CEO of Wells Fargo, and Why It Matters

#43

Post by tedunangst »

wheelerwj wrote: post #6
AstroJetson wrote: post #5

Earlier quoted context omitted.

Its becoming cases of the wheels of justice turn, they turn slowly but they turn. The rate they are turning has become much faster (never --> 3 years is a big speed improvement) and the people that are getting caught in those wheels is a much higher level. 5 years ago clerks, now a CEO.

Then maybe we should ditch the wheels and use Hammers of Justice instead? The ceo PERSONALLY made more money during the scam than entire bank was fined. really epic stuff here, I mean, Really, way to dish out the pain!

The bank was also fined many times more than it made from the scam.

Re: How Elizabeth Warren Took Down the CEO of Wells Fargo, and Why It Matters

#44

Post by AnimalMuppet »

bsder wrote: post #26
forgetsusername wrote: post #19

Earlier quoted context omitted.

Anyone who has worked in a company of any size knows it'd be down near impossible to know the inner working at all levels of the organization. So, yes, the guy is accountable and needs to lose his job. But the idea that he should go to prison for something like this is ludicrous.

> But the idea that he should go to prison for something like this is ludicrous. Fine. Then the company should get the "death penalty" and be liquidated. Especially for something like the banking sector where the federal government could replace a bank almost instantaneously, the "death penalty" should get dropped on companies that engage in malfeasance.

> Especially for something like the banking sector where the federal government could replace a bank almost instantaneously...

Say what? It takes months to years for the FDIC to wind up a small bank. What is your basis for saying that the government can replace a huge bank almost instantly?

(Or perhaps the correct question is: What is your definition of "replace"?)

Re: How Elizabeth Warren Took Down the CEO of Wells Fargo, and Why It Matters

#45

Post by jnbiche »

henrikschroder wrote: post #29
rconti wrote: post #23

Earlier quoted context omitted.

Prison may be a bit harsh. And in a vacuum, you're right. It would be somewhat unfair to drop the hammer, out of nowhere, on some unsuspecting CEO who just did "business as usual". But that's no excuse; it just means we need to create a culture where this kind of thing becomes increasingly unacceptable, so that in the future executives will know what's expecting of them, and what the consequences can be. The "uninten…

> The CEO can't know what every last person in the organization is doing, but they should be incented to make it their business to a culture in place that doesn't permit this Where I'm from, there's a group af crimes such that if an employee at a company does them, the CEO will absolutely go to jail, even if they knew about it or not. For example, if your company produces toxic sludge as a byproduct, and someone at t…

> For example, if your company produces toxic sludge as a byproduct, and someone at the company dumps it in nature instead of properly taking care of it, it's jailtime.

That's a kind of criminal collective responsibility, which I find repugnant whether it's a mother in Palestine being held criminally responsible for her son suicide bomber, or it's a CEO being held criminally responsible for the wrongdoings of some low-level employee that they did not direct and were even unaware of.

Personal liability is arguably OK here, but criminal liability like you describe ("goes to jail") is most certainly not, and I'm surprised that there are so-called enlightened legal jurisdictions that do this.

Re: How Elizabeth Warren Took Down the CEO of Wells Fargo, and Why It Matters

#46

Post by muninn_ »

adekok wrote: post #37

What do the libertarians say about this theft? While I understand the idea of the free market, I don't see how that would have protected the consumer in this case. The CEO has millions of times the power of the average consumer, and can harness thousands of people to his agenda. The consumer is left to either (a) pay the "idiot" tax of being stupid enough to sign up for a thieving bank, or (b) rely on the government…

If you live in the West you live in a free market right now. Asking the "libertarians" what they would do about this incident in the "free market" is a deceptive thing to say. Not only does it ignore the fact that we live in a free market, it unjustly pins the failings of the system we live in on a philosophy which has a wide array of different nuances and subgroups. Libertarians range from anarcho-capitalists, to socialist libertarians, to anarcho-communists. Additionally, a "perfect free market" does not exist and never could. Nor could a "perfect government".

If you want to be angry, look at how the government is failing you now. If you want to say that the "non-free market" you're living in is better, well, what happened here? The CEO just gets to retire and they have to pay a measly fine.

Oh and before anybody says "we don't live in a true free market", until we live under absolutely no system of government, nobody civilization has really ever lived under what is technically a free market. If you pay taxes or tribute or respect some sort of authority you live in a government and it is acting upon the market. I find that to be a useless definition.

Re: How Elizabeth Warren Took Down the CEO of Wells Fargo, and Why It Matters

#47

Post by AnimalMuppet »

tswartz wrote: post #9

I appreciate that Warren didn't let Stumpf talk his way out of taking any responsibility for the actions of his employees and made a clear argument as to why he should be held accountable. Unfortunately, it seems the primary reason he resigned was because the public outrage was loud enough. It seems that until CEOs are personally held accountable via fines or prison (as Warren suggests) we won't see a very big change…

Personal accountability for CEOs is a good step. However, I think the most needed step is that it becomes unprofitable for the owners.

Re: How Elizabeth Warren Took Down the CEO of Wells Fargo, and Why It Matters

#48

Post by tedunangst »

wheelerwj wrote: post #17
tswartz wrote: post #9

I appreciate that Warren didn't let Stumpf talk his way out of taking any responsibility for the actions of his employees and made a clear argument as to why he should be held accountable. Unfortunately, it seems the primary reason he resigned was because the public outrage was loud enough. It seems that until CEOs are personally held accountable via fines or prison (as Warren suggests) we won't see a very big change…

Bullshit he resinged! at 63, he's the oldest ceo of all the top 5 banks. Stumpf did't resign, he retired!

Resinged is a nice way to put it. Once before the senate, then again before the house.

Re: How Elizabeth Warren Took Down the CEO of Wells Fargo, and Why It Matters

#49

Post by zodiac »

I watched Stumpf testify in front of the Senate Banking Committee, and while I agree that (from what I saw) he should be held accountable, what I don't understand is why the right venue for it is the Senate instead of the Judiciary.

Warren clearly thinks that Stumpf wasn't just doing a bad job, but that what he did and didn't do was criminal in some way (eg the talk of jail time, comparisons to Enron in the article). The CFPB settlement also indicates that there was wrongdoing, at least on the part of Wells Fargo the corporation.

Isn't the right thing to do to prosecute Stumpf in court? The testimony seemed to me to have no purpose other than to put Stumpf "on trial", and it led to damaged PR and his resignation, but it looked like a "trial" without due process protections like knowing what exact charges he was facing. Another missing protection I was particularly disturbed by was how often she would cut him off and not allow him to defend himself (yes, his answers were clearly evasive, but it still isn't fair to do that).

Re: How Elizabeth Warren Took Down the CEO of Wells Fargo, and Why It Matters

#50

Post by many_bells_down »

adekok wrote: post #37

What do the libertarians say about this theft? While I understand the idea of the free market, I don't see how that would have protected the consumer in this case. The CEO has millions of times the power of the average consumer, and can harness thousands of people to his agenda. The consumer is left to either (a) pay the "idiot" tax of being stupid enough to sign up for a thieving bank, or (b) rely on the government…

Businesses compete for consumers. Consumers prefer honest businesses. Businesses optimize for consumer preferences.

Edit: The business considers this complex, multi-variable equation and tries to extract as much profit as possible. In many cases, the consumer is apathetic. Personally, I signed up for a Wells Fargo account last week despite being completely aware of this news. As a joke, I almost asked the guy if I _already_ had an account!

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