The Blog Of The Securities Industry Professional Association

Wells Fargo: Crime Does Pay




We have been monitoring closely the events of the last few months and it appears that rules and laws are in place but are often ignored or enforcement is very selective. Small brokerage firms in particular have seen their compliance cost and burden soar due to nonstop rule making that continually requires yet another layer of oversight, review and record keeping. While a small Broker Dealer and his two registered reps are busy paying upwards of $10,000 a year for email archiving systems in a non editable and non erasable format, we have a Presidential candidate that was able to make upwards of 30,000 emails disappear and then had staff take hammers to the email devices, phones and tablets. The FBI investigated, admitted she did these actions and then yawned loudly and said “_There is nothing to see here folks_”. Meanwhile a small firm in Missouri would be fined $25,000 and be permanently barred from associating with any financial firm in any capacity for destroying evidence.

Yesterday Wells Fargo announced it will pay a fine of **180 million** to settle a case in which 5,300 employees were fired for the following: “_It is alleged that Wells Fargo’s employees opened around 1.5 million deposit accounts that were not authorized by the customers. The employees then illegally transferred funds from the existing customer accounts to the new accounts, in order to plump their sales numbers and receive additional compensation”_

Call us crazy but we view this as: Fraud, Unauthorized trading, Theft of customer funds, Misappropriation, Invasion of privacy, Conversion of customer assets, and a violation of the privacy acts and Identity theft to name just a few. In what world is it acceptable to steal from your customers and just pay a fine? Imagine a string of bank robberies taking place across the country and then when confronted the robbers can merely agree to pay back the money they stole and agree to pay a fine for damages. This is outrageous behavior and once again illustrates how all these rules and regulations are nothing more than a burden because when faced with a real crime, the regulators will just look the other way. All the supervision layers, manuals and banking laws are nothing more than a smoke screen. We believe there should be a freeze on all new banking and securities regulations until the people enforcing these laws agree to actually enforce them equally on all. We believe each and every employee should be brought up on formal charges after a full investigation and if found guilty they should be barred from the financial industry and face jail time. It’s time we stop allowing the larger financial firms to pay their way out of their illegal schemes. Every year small firms have to issue annual privacy statements, customer statements, use of customer information and more. Does it really matter if nobody is going to follow it and nobody is enforcing it?

What is your opinion? As always, we value your feedback. fraud

Post Metadata

September 23rd, 2016



Comments are closed.