Well, it’s now coming at Wells Fargo from nearly every angle.
As the embattled megabank’s CEO, John Stumpf, prepared to be grilled on Capitol Hill on Tuesday over the fake account scandal surrounding the bank, Democratic presidential nominee Hillary Clinton weighed in on the issue, saying that she is “deeply disturbed” by the bank’s conduct, and took the opportunity to defend the Consumer Financial Protection Bureau.
In an open letter ostensibly to Wells Fargo’s customers, Clinton said that she expected Stumpf to have a “clear explanation” of what led to the bank being fined $185 million by the CFPB, the Office of the Comptroller of the Currency, and the city and county of Los Angeles.
Whether Stumpf succeeded in doing so is another question entirely.
Stumpf took his lumps on Tuesday before the Senate Banking Committee, with Sen. Elizabeth Warren, D-Mass, calling for his resignation and for him to face criminal prosecution.
One by one, the senators took turns questioning (some with more vigor than others) Wells Fargo’s actions. Sen. Jon Tester, D-Montana, put it best, as during the hearing he mockingly congratulated Stumpf and Wells Fargo for doing something that hasn’t been done in Tester’s 10 years on the committee – uniting it on a major issue.
“There is simply no place for this kind of outrageous behavior in America,” Clinton said in her open letter.
“Our economy depends on a strong and safe banking system to help keep it moving,: Clinton continued. “But even after Americans spent years working hard to recover from the Great Recession, the culture of misconduct and recklessness that preceded that crisis too often persists.”
And Clinton said she has a “plan” to deal with the “culture of misconduct and recklessness” she referenced.
The main tenet of that plan? Protect the CFPB, the regulator constantly in the crosshairs of the Republican Party.
The Republican Party’s latest shot across the CFPB’s bow is the Financial CHOICE Act, introduced earlier this year by House Financial Services Committee Chairman Rep. Jeb Hensarling, R-TX.
The bill, which passed out of the House Financial Services Committee last Tuesday by a vote of 30-26, would bring significant reforms to the CFPB, including bringing the agency’s budget under Congressional supervision and changing the leadership structure from a single director to a multi-person committee.
The Republican Party national platform went even further, calling for the potential abolition of the CFPB.
Clinton, unsurprisingly, stated that she would defend the CFPB if she becomes president.
“We need to defend the Consumer Financial Protection Bureau. The unfair and abusive practices at Wells Fargo remind us that we need tough watchdogs looking out for customers,” Clinton said in her letter.
“The CFPB worked with local authorities and enforced the law – assessing its highest penalty ever, and bringing the bank’s illegal activity into the national spotlight,” Clinton continued.
“Donald Trump, the Republican Party, and Wall Street lobbyists are desperate to dismantle this effective agency, which is dedicated solely to protecting consumers from unfair and deceptive practices,” Clinton said. “I won’t let them put the CFPB under their thumb. I’ll protect the CFPB and make sure it can continue its essential work on behalf of the American people.”
Clinton also calls for “real consequences when firms on Wall Street break the law.”
Clinton says that it is “frustrating” to see a bank pay a fine in an instance such as this one, and then be allowed to “keep doing business as usual.”
Under a Clinton administration, executives should be held individually accountable when “rampant illegal activity happens on their watch,” Clinton says.
“Their compensation should take a hit if their companies pay major fines,” Clinton says. “And they must face appropriate legal consequences if they break the law.”
Clinton also states that no financial institution should be “too big to manage,” adding that her plan includes adding safeguards to “address the risks that the big banks continue to pose to our system.”
And if a bank can’t be “managed effectively,” Clinton says, it should be “broken up.”
