Wells Fargo’s Senior Management Must Be Held Responsible for Bank Fraud

The arrogance of Wells Fargo was apparent when it announced earlier this month that it would phase out a questionable “sales goals” program in Jan. 2017. Those sales goals created the incentive for 5,300 Wells Fargo employees (since fired for ethical violations) to create some 2 million fraudulent customer bank accounts. The bank announced Wednesday that it will discontinue the sales goals by the end of the week. Meanwhile, eEx-Wells Fargo employees  filed a class action lawsuit seeking $2.6 billion in damages. Finally, on Oct. 12, 2016, John Stumpf  abruptly “retired.” Stumpf reportedly did not get any severance but will retain more than $100 million in vested stock, plus accumulated pension and 401(k) benefits exceeding $24 million –  Ed.

A few years ago, I opened an account at a local branch of Wells Fargo Bank for a limited purpose. Once that purpose was accomplished, I intended to immediately close the account.

A young bank officer who facilitated the transaction persuaded me to keep the account open. He assured me that he had set up my account in such a way that I would never lose the account balance of $100 deposit through the churning of bank fees.

Of course, in less than a year, all the money was gone, usurped by Wells Fargo in bank fees. Meanwhile, I was assaulted  with notices, offers and credit card applications. One paper in this mountain of paperwork may have contained an obtuse notice that my account was being transferred to a different charge-bearing vehicle. I complained to the bank, which said it was my fault, and then I put the matter behind me, chalking it up to yet another example of pervasive and persistent financial fraud in America.

So this week, it was with interest that I read about the Wells Fargo’s practice of using unrealistic sales goals to pressure employees to set up phony accounts and cheat customers. The bank has fired 5,300 employees for ethical violations and announced it would eliminate all product sales goals in retail banking, effective January 1, 2017.

Seriously?

Remember the financial crisis of 2007, which propelled the world into a deep recession, from which many will never recover?  How much of the Wall Street meltdown was due to unethical practices promulgated by massive financial institutions ( like Wells Fargo) which required workers to lie, cheat, and steal  in order to remain on the payroll?

Why is John Stumpf, Chairman and CEO of Wells Fargo, still working there?

Senior management of Wells Fargo is responsible for the fraud on its customers, not the underlings with families to feed in an unforgiving economy.  The bank employees who were fired for ethical violations are culpable and shouldn’t be working in a position of trust. But Wells Fargo created the incentive for the unethical behavior  of its employees by adopting unrealistic sales goals to increase profits year after year.  Indeed,  Wells Fargo plans to continue enforcing these “product sales goals” until January 2017.

If America permits the senior management of Wells Fargo  to scapegoat its own employees and avoid responsibility for financial fraud, aren’t we inviting another financial meltdown?  Haven’t we learned anything?

Wells Fargo CEO John Stump needs to go. IMMEDIATELY!

The bank has been fined $100 million by the U.S. Consumer Finance Protection Bureau and ordered to pay back consumers harmed by its actions.

Wells Fargo & Company, headquartered in San Francisco, is one of the nation’s biggest banks. It has $1.9 trillion in assets and, according to the company, serves one in three households in the United States. Wells Fargo & Company was ranked No. 27 on Fortune’s 2016 rankings of America’s largest corporations.

Outfoxed: Carlson Settles for $20 Million & Apology

Former Fox News Anchor Gretchen Carlson  has received among the largest payouts in history  – $20 million – to settle a sexual harassment case.

Ironically, the case was settled not by the defendant, former Fox News chairperson Roger Ailes, but by his former employer, 21st Century Fox, the parent company of Fox news.  Ailes, 76, won’t pay a dime. (Not only that,  Ailes received a $40 million payout from Fox when he left his job under pressure in July.)

It is speculated Tuesday that Carlson, a former Miss America,  secretly tape recorded Ailes, whom she alleged refused to renew her contract after she refused to have sexual relations with  him.

The largest sexual harassment award in history is believed to have occurred in 2011 when a federal jury in Tennessee awarded $95 million to Ashley Alford, a young employee who was  sexual  harassed and physically assaulted by a supervisor  at the rent-to-own company, The Aaron’s Inc. The award included $15 million in compensatory damages and $80 million in punitive damages. U.S. District Court Judge J.  Michael Reagan subsequently reduced  the amount the jury awarded Alford on the sexual harassment claim from $4 million to $300,000 pursuant to a federal statutory cap. on damages under Title VII of the Civil Rights Act. Judge Reagan also vacated $50 million of the punitive damages award. That still left Alford with about $41 million.

In addition to the monetary award, 21st Century Fox issued a press release stating:  “We sincerely regret and apologize for the fact that Gretchen was no treated with the respect and dignity that she and all of our colleagues deserve.”

Meanwhile, two other women at Fox reportedly were offered settlements after complaining about sexual harassment.

Carlson’s complaint appears to have prompted the sudden departure of Fox personality Greta Van Susteren from the network on Tuesday. Susteren had publicly defended Ailes and accused Carlson of retaliating against Ailes after  being fired due to poor ratings.

Carlson received little support generally from her former Fox colleagues. In addition to Van Susteren, more than a dozen top personalities at Fox News including Sean Hannity, Neil Cavuto and Kimberly Guilfoyle defended Ailes against claims of sexual misconduct.

EEOC Pitches Lack of Diversity in the Tech Industry as an “Innovation Opportunity”

*NOTE:  The EEOC issued a report at its meeting (discussed below) that completely ignored age discrimination except for a footnote stating that more research on age discrimination is needed. According to the report,  compared to overall private industry, the high tech sector employed a larger share of whites (63.5 percent to 68.5 percent), Asian Americans (5.8 percent to 14 percent) and men (52 percent to 64 percent), and a smaller share of African Americans (14.4 percent to 7.4 percent), Hispanics (13.9 percent to 8 percent), and women (48 percent to 36 percent). Ed.

After more tGoogle_Mountain_View_campus_dinosaur_skeleton_'Stan'han a decade of ignoring rampant and blatant age discrimination in the tech industry (and everywhere else), the issue appears has surfaced on the EEOC’s radar screen. But it is not  seen as an overly-ripe target for enforcement of older workers civil rights. Rather, it is couched as an “innovation opportunity.”

The EEOC has announced it will hold a meeting in Washington, DC, on Wednesday entitled, “Innovation Opportunity: Examining Strategies to Promote Diverse and Inclusive Workplaces in the Tech Industry.”

While it might be hoped the EEOC would actually enforce the Age Discrimination in Employment Act (ADEA), the Agency deserves credit for acknowledging that age is a diversity issue, which is something that Silicon Valley  stubbornly refuses to acknowledge. Also, the EEOC deserves major kudos given that the Obama administration  for the past eight years, has treated older workers  like an obstacle to diversity and not a group that deserves equal rights under the law.

One of the invited panelists for Wednesday’s meeting is an attorney from the AARP Foundation, which is an organization that the EEOC apparently entrusts to be polite about the EEOC’s regulatory lapses during the past decade. The AARP Foundation almost has to be polite because it’s mothership is the the monolithic AARP, which also has done little to advocate for older workers by combating age discrimination. Moreover, the AARP is reaping billions  from the sale of Medigap health insurance after having lobbied to keep Medigap reforms out of Obamacare. The AARP receives  an estimated 4.95 percent of every dollar that seniors spend on its Medigap plans. These fees are reportedly double the income the AARP receives from “membership:” dues.  A study by the Kaiser Family Foundation found that Medigap reforms blocked by the AARP would have saved the average senior as much as $415 in premiums per year.

It is perhaps not surprising that my name does not appear on the EEOC’s guest list.

My groundbreaking 2014 book, Betrayed: The Legalization of Age Discrimination in the Workplace, criticizes the systemic inequality of older workers in American society, especially in Silicon Valley. I note that the ADEA was weak to begin with and  then was further eviscerated by the U.S. Supreme Court. Meanwhile, Congress has done nothing to insure equal rights for older workers. I also  criticize the EEOC  for failing to combat an massive increase in age discrimination complaints since 1998 and I point out that President Barack Obama signed a devastating executive order in 2010 that actually legalizes age discrimination in federal hiring.

I may be alone in the U.S. in reporting that the EEOC itself stands accused of engaging in systemic age discrimination in hiring

Earlier this year I  reported that the U.S. Chamber of Commerce  filed a friend-of-the-court brief in an age discrimination case in which it defended employers who practice age discrimination in hiring by noting that the EEOC does the very same thing.  The Chamber cited the EEOC Attorney Honor Program, which employs in “permanent” positions “third-year law student[s], “full-time graduate law students[s],” and “Judicial Law Clerk[s] whose clerkship must be [their] first significant legal employment following [their] graduation.”  The EEOC states on its web site that graduates of the Honor Program go on to serve as trial attorneys or Administrative Judges in the EEOC’s District Offices. Since the vast majority of recent law clerks and law and graduate students are under the age of 40, it is not a stretch to conclude that the  EEOC program has a disparate impact upon attorneys who are aged 40 and above.  That’s supposed to be illegal under the ADEA.

Criticism of an administration or federal agency often is dismissed as partisan politics.  I do criticize  the Obama administration, the U.S. Supreme Court and Congress for abandoning older workers during the worst recession in 100 years.  Millions of older Americans remain subject to pervasive discriminatory hiring practices and bogus layoffs and restructurings. I do not argue, however, that the Republicans would have done better than the Democrats. I simply don’t think they could have done much worse. That’s why I support Bernie.

Why Things Keep Getting Worse for Workers

Author Thomas Frank in his new book, Listen Liberal: Or, What Ever Happened to the Party of the People, posits that wealth equality worsened during the Obama administration because the so-called party of the working class has been co-opted by a “professional class” of  hyper-educated elite.

He argues –  very convincingly in my opinion – that America is now governed by two political parties, neither of which represents the interests of average workers. This, he says, is why Americans are flocking to outsider Presidential candidates like Donald Trump and Bernie Sanders.

Franks says the Republican Party represents the rich while the Democratic Party represents a  hyper-educated professional elite, many of whom hail from exclusive Ivy League universities.  The class includes a broad swath of professionals, from lawyers and doctors to economists and Internet entrepreneurs.

The Democratic professional class is  liberal on cultural issues, writes Frank, but  NOT when it comes to worker rights.

He cites President Bill Clinton’s strong support for NAFTA, which served the interests of professionals at the expense of  average workers.  He said NAFTA further dis-empowered workers, already reeling from anti-union policies, because it gave companies incentive to pick up stakes and move.

Frank criticizes Obama for bailing out the banks during the Great Recession without prosecuting Wall Street law breakers. He notes the Roosevelt Administration moved frequently to break up big banks and fired Wall Street executives.

Frank also contends that  “Big Medicine” and “Big Learning” are slowly bankrupting America.  With respect to “Big Learning,” he said tuition rates have risen exponentially while more and more PhDs are forced to  work as non-tenured adjunct professors earning about $1,500 per course.

In an excellent interview by Kathy Kiely on Bill Moyers web site, Moyers & Company, Frank calls Bernie Sanders a badly needed voice of discontent in the Democratic party, the only one who is raising issues about monopoly and anti-trust, fair trade, inadequate health care, out-of -control college tuition, etc.

If Sanders is not a candidate in November, Frank said he will vote for Hilary Clinton over Trump, though unenthusiastically.