Wells Fargo didn’t merely open 2,000,000 fraudulent accounts and bill its customers for them; it also tricked its customers into signing up for insurance policies, at mass-scale.
The scandals keep coming: US regulators have rejected Wells Fargo’s “living will” — a plan for unwinding the bank’s affairs if it fails — for the third time, meaning that the bank will now face tough sanctions, including a ban on establishing international subsidiaries and on acquiring nonbanking companies. The City of San Francisco, the birthplace of Wells Fargo, has now blacklisted the bank from doing its business — something the state of California had already done.
But lucky for Wells Fargo, Donald Trump personally owes them $100,000,000, and a further $410,000,000 through various business fronts. Trump will have the personal power to determine whether and how any further federal investigations are conducted, and sanctions are applied.
Trump’s election has been seen as a boon to Wells Fargo, pushing its troubles off the front page. The continued Republican leadership of the Senate could prevent additional hearings into Wells Fargo’s practices, and the company’s main federal antagonist, the Consumer Financial Protection Bureau, is in line to be neutered in a Trump administration; Republicans are planning to put CFPB’s budget under Congressional appropriations control, which could limit their resources.
In addition, incoming Transportation Secretary Elaine Chao, the wife of Senate Majority Leader Mitch McConnell, has sat on the Wells Fargo board since 2011, earning $1.2 million. She plans to step down after her Senate confirmation to the Trump cabinet.
Trump’s personal involvement with Wells Fargo adds a clear conflict of interest. In the case of the living wills, Trump will have the opportunity to add at least two board members to the Federal Reserve, one of the two agencies governing the process.
Wells Fargo Is on a Losing Streak, But Still Has Some Trump Cards
[David Dayen/The Intercept]