Democratic senators are demanding that the Justice Department investigate senior executives at Wells Fargo to ensure every person who may have been involved in the bank’s massive fraud scandal are held accountable.
“Americans are rightly frustrated when they see that justice for the wealthy and powerful is very different than justice for everybody else,” the senators wrote in an open letter to Attorney General Loretta Lynch. Among the signatories are Sens. Elizabeth Warren, D-Mass., and Bernie Sanders, I-Vt.
Wells Fargo is accused of creating millions of fraudulent credit and deposit accounts without their customers’ permission to meet growth targets. The Consumer Financial Protection Bureau levied a $100 million fine on Wells Fargo for the fake accounts, the largest penalty of its type in history.
However, the senators argued that the Justice Department must extend its investigation of the bank to include the individuals who may be involved in order to promote corporate responsibility.
They are calling upon the Attorney General to stop what they describe as a continuing trend of Wall Street executives escaping from criminal prosecution, and relying on golden parachutes to cushion their fall. They said that instead of targeting top corporate leaders for questionable activities that they argue led to the 2008 financial crisis, the government forced shareholders to bear the brunt of legal settlements. Moreover, the reward for illegal activity tended to be greater than the punishment.
“A bank teller that takes a handful of bills from the cash drawer is likely to face charges for theft and prison time. She can’t hide behind an army of lawyers and corporate policies that diffuse accountability for those at the top,” they wrote. “Meanwhile, an executive who oversees a massive fraud that implicates thousands of bank employees and costs customers millions of dollars can walk away with a hefty retirement package and millions in the bank.”
Though they admitted there isn’t enough evidence yet for them to conclusively determine whether any of the Wells Fargo senior executives did anything illegal, they said they are concerned that last week’s Senate Banking Committee hearing with the bank’s Chairman and CEP John Stumpf seemed to have benefited from the behavior he failed to take action to prevent.
“Mr. Stumpf testified under oath that he became aware of employees creating fraudulent bank accounts in 2013. Yet for years thereafter, Mr. Stumpf did not disclose that information to investors and did not take decisive action to crack down on the incentives that encouraged that behavior, even as the bank fired more than 5,000 employees for improper behavior,” the letter stated. “Instead, he continued to personally benefit by pitching Wells’ inflated retail account numbers to investors.”
