Wells Fargo CEO John Stumpf will be on Capitol Hill today, where he’s likely to receive a very unwelcome reception from the Senate Banking Committee, whose members will be demanding answers about the banking giant’s latest controversy.
To briefly recap, the Consumer Financial Protection Bureau recently reached a record settlement with Wells Fargo after the company was caught allegedly bilking consumers, enrolling customers in banking services without their permission, then charging them fees for accounts and services they neither sought nor authorized.
Stumpf has been in damage-control mode – see, for example, his apologetic op-ed today in the Wall Street Journal – though there are still some unanswered questions about what Wells Fargo executives knew and when they knew it.
Of course, all of this comes against the backdrop of the U.S. presidential campaign, and the story has not escaped Hillary Clinton’s attention. In fact, the Democratic candidate released a well-timed open letter to Wells Fargo customers overnight. It reads in part:
“I was deeply disturbed when, last week, we found out that Wells Fargo had engaged in widespread illegal practices over many years. The bank secretly opened up millions of accounts for customers without their consent – betraying their customers, misusing their personal information and leading many to be slapped with unjust fees and other charges. Today, Wells Fargo’s CEO will appear before Congress. He owes all of you a clear explanation as to how this happened under his watch.“There is simply no place for this kind of outrageous behavior in America.“Our economy depends on a strong and safe banking system to help keep it moving. 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. I have a plan to address it.”
The first tenet of the plan: defend the Consumer Financial Protection Bureau, which uncovered the wrongdoing and negotiated a massive settlement.
“Donald Trump, the Republican Party, and Wall Street lobbyists are desperate to dismantle this effective agency,” Clinton wrote, “which is dedicated solely to protecting consumers from unfair and deceptive practices. 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’s rhetoric is rooted in fact. Indeed, just days after the CFPB’s greatest success story to date, House Speaker Paul Ryan (R-Wis.) condemned the agency, reminding the public of his plan to gut the bureau if given a chance.