Wells Fargo Hit with $1B in Fines • Hacker News Board

Re: Wells Fargo Hit with $1B in Fines

#421

Post by ansible » Sun, Apr 22, 2018, 1:37 AM UTC

uxp wrote: post #399

rectang wrote: post #330

Earlier quoted context omitted.

A billion ain't enough. I don't have faith in Wells Fargo ownership or leadership to ensure ethical or even legal behavior in the absence of sufficient incentives. The market as currently set up encourages large scale misbehavior and destructive abuse by Wells Fargo of its customers. The stockholders are insulated by distance from the misery their company causes, and the executives outright make out like bandits, eve…

My parents opened an account for me with a bank when I was ~6 years old in 1988 that was swallowed up by Wells Fargo in the early naughts, which I maintained until about 6 years ago. At around the time I withdrew all my money and moved it to a local CU, I was going through financial hardships, and frequently would have less than a hundred dollars to my name. I never had any problems with them until then, when they wo…

And it is for reasons like you mentioned that I discourage everyone I know from using debit cards for anything.

I only use credit cards for purchases, and I control when the money moves around. And I always pay the balance every month.

Re: Wells Fargo Hit with $1B in Fines

#422

Post by henrikschroder » Sun, Apr 22, 2018, 2:03 AM UTC

ensignavenger wrote: post #350

henrikschroder wrote: post #297

Earlier quoted context omitted.

Title company? Title insurance?!? A third-party for-profit company handles some aspect of the transfer of property, instead of, you know, government? And in case this third party fucks up, you need to pay for insurance?!? Jesus.

You said the real estate agent handles it where you are from- are real estate agents government officials where you are? You don't have to have a title company, you could do it yourself, but a typical real estate transaction involves large amounts of money and multiple parties, so most people want someone else to handle it all. If you are borrowing money, you lender will probably insist on it.

This is how it works in Sweden, as far as I understand it:

Real estate agents have to be licensed, and part of their duties is of course to verify that the seller is who they say they are and that they own the thing they're trying to sell. When I sold an apartment, I had to show my ID to my agent so he could verify me.

The registry of who owns what pieces of land is managed by a government office, and government data is by legal default public, so checking if a seller actually owns a piece of land is trivial. You don't need to chase down a distributed sealed deed history thing thing, it's basically a single national database at this point.

So it's really simple to do, and the responsibility is on the seller's agent, who in turn has a strong incentive to not screw up, or they lose their license and their job.

When you go to your lender for a pre-approval on a mortgage, they want to know which piece of property you're buying, and they typically check that it's being sold by a licensed real estate agent, because if it is, then they can be assured that the seller is verified and actually can sell the property.

When you sign the purchase contract - which is typically one or two pages long - you sign one copy for the seller, one for the buyer, one for the agent, and one for the government office, and the agent helps you fill out the (short) form that goes with it so you can send it in and get the ownership legally transferred to you. That's it.

There's so little work involved with verifying ownership and transferring ownership, that it's just put on the shoulders of the real estate agents. The idea that you would need yet another party to handle this aspect is completely ludicrous in Sweden, it makes no sense.

Re: Wells Fargo Hit with $1B in Fines

#423

Post by agency » Sun, Apr 22, 2018, 2:42 PM UTC

johnwheeler wrote: post #412

perseusprime11 wrote: post #408

Earlier quoted context omitted.

This billion dollar fine is like a small change for them. Warren Buffet has a lot of exposure to this company and he has been influencing to let them go for a long time. Go figure!

Well, the shareholders have suffered outsize to the amount of damage to the victims in dollar terms by orders of magnitude. Probably 100-150 billion, conservatively, wasn’t realized. Wells didn’t get in trouble during the financial crisis because they stuck to conventional banking instead of investment banking, like their peers. Their reputation was unmatched. Since the crisis WFC has floated low double digits percen…

Won’t somebody please think of the shareholders?

Re: Wells Fargo Hit with $1B in Fines

#424

Post by clairity » Sun, Apr 22, 2018, 6:07 PM UTC

HoyaSaxa wrote: post #400

blacksmith_tb wrote: post #51

Earlier quoted context omitted.

My impression was that most credit unions and small banks had pretty limited online banking, headaches with ATMs (not that I use them as much these days), etc. They are too small develop those services in-house, so I imagine they buy them as SaaS? Are they good enough now? I have Wells accounts I'd be happy to jettison...

You're right that traditionally credit unions and community banks have used antiquated consumer facing tech (online banking, mobile banking, loan applications, online account opening, etc) owned by 1 of 3 OG financial technology companies in the U.S.: Fiserv, FIS, and Jack Henry. They are all multi-billion dollar public companies that have formed primarily via acquisitions. I started a company to challenge the incumb…

yes, i've indirectly dealt with both fiserv and jack henry on past consulting projects and they're definitely slow-moving dinosaurs. =)

Re: Wells Fargo Hit with $1B in Fines

#425

Post by openasocket » Sun, Apr 22, 2018, 6:45 PM UTC

TheCoelacanth wrote: post #419

stjohnswarts wrote: post #344

Earlier quoted context omitted.

You're wrong, in addition to the fine paid to the Feds, they also have to pay back the people they lied to along with interest.

They have to pay back the direct damages that they caused. They don't have to pay all of the damages resulting from the initial damage. If the money they took caused someone's car to be repossessed which caused them to lose their job, they don't have to pay for the lost income from the job.

Well, under this ruling they don't have to. But the victims didn't sign off on this, they are perfectly entitled to sue for whatever they think they deserve. (Though if they intend to do so they should absolutely not accept the money they try to give them as a result of this deal, as that will make their case that much harder to win)

Re: Wells Fargo Hit with $1B in Fines

#426

Post by mcintyre1994 » Sun, Apr 22, 2018, 9:24 PM UTC

kaizendad wrote: post #19

OK, but Wells Fargo made $5 billion last year, and the activity they were fined for took place over many years, which leaves me to ask: after the fines, was this activity profitable or not? If it was profitable, do the fines actually dissuade future dishonesty? Also, apparently Wells Fargo thinks that 27,000 people lost their cars over this. I bet none of those people will be made whole. Cars are really essential thi…

HSBC only got $1.9bn for money laundering for terrorists and cartels, there's no intention anywhere in financial regulation to punish big banks.

Re: Wells Fargo Hit with $1B in Fines

#427

Post by gr1zzlybe4r » Mon, Apr 23, 2018, 12:22 AM UTC

I'm commenting late on this and for the first time on HN ever, but the things that big banks can do and get away with are ridiculous. It simply doesn't matter what they do to their customers because they will always be bailed out and get their way. They don't have to care because it doesn't matter.

Re: Wells Fargo Hit with $1B in Fines

#428

Post by freddie_mercury » Mon, Apr 23, 2018, 3:07 AM UTC

chiefalchemist wrote: post #396

freddie_mercury wrote: post #364

Earlier quoted context omitted.

Actually there is a lot of real world evidence that fines dissuade honesty.

The Wells Fargo fine indicates there are gaps in that evidence ;)

"dissuade" does not mean "completely prevent forever in all circumstances"

Dissuade means something more like "reduce the chances of it happening".

Re: Wells Fargo Hit with $1B in Fines

#429

Post by freddie_mercury » Mon, Apr 23, 2018, 3:08 AM UTC

rbanffy wrote: post #384

freddie_mercury wrote: post #364

Earlier quoted context omitted.

Actually there is a lot of real world evidence that fines dissuade honesty.

Were the decision makers involved adequately punished? Will they ever do something like it again? Fines dissuade from making exactly the same thing but that doesn't seem to prevent different kinds of scam.

"dissuade" does not mean "completely prevent forever in all circumstances"

Dissuade means something more like "reduce the chances of it happening".

If the OP had written "fines do not completely prevent forever the chances of a bad thing happening" everyone would have realised that was a nonsensical bar because even putting in jail doesn't do that.

Re: Wells Fargo Hit with $1B in Fines

#430

Post by tolle » Mon, Apr 23, 2018, 11:19 AM UTC

belorn wrote: post #293

aphextron wrote: post #4

Something has happened to big banks along the way, where they no longer actually provide banking services to their customers. When I walk into a Wells Fargo branch now and sit down with a "banker" to take care of my accounts, it consists of sitting next to them while they call 1-800-WELLSFARGO for me and talk to a call center. There simply is no service anymore. I walked into my local branch to open up an IRA last we…

In Sweden bank provide two forms of services. All digital services which is what they are strongly pushing for, and ATM machines where customers withdraws (with a max of $1500 per week) and store owners can deposits in a few special machines in the "large" cities. Practically no office deal with cash and the few remaining is purely for consultations. Through all this digitization and cost savings the numbers of banks…

Probably because the massive amount of regulations that have been added in the last century means starting with nothing is a massive undertaking if you aim at providing a full service bank. Startups are popping up, but usually they only do one thing. And a limited set of that one service at that.