Republicans also took a tough stance, especially around the bank's "cross-selling" business model where consumers have more than one product or service with the firm. "This isn't cross-selling, this is fraud," said Sen. Pat Toomey (R., Pa.), referring to Wells Fargo employees setting up accounts for customers in products they didn't ask for or know about. "Wells Fargo executives [were] completely out of touch."
As Rachel highlighted on last night's show, Wells Fargo chairman and chief executive John Stumpf visited with the Senate Banking Committee yesterday, and members seemed quite eager to rake him over the coals in response to the banking giant's recent scandal. Sen. Elizabeth Warren (D-Mass.), in particular, went after Stumpf and urged him to resign.The CEO's cool welcome hardly came as a surprise. We've been keeping an eye on the Wells Fargo controversy, uncovered by the Consumer Financial Protection Bureau, which is obviously outlandish. 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.Several outlets noted that yesterday's hearing featured a rare display of bipartisanship. The Wall Street Journal, for example, reported that Senate Republicans, especially those up for re-election this year, weren't at all eager to defend Wells Fargo's alleged wrongdoing.
And at a certain level, this is as it should be. There's nothing partisan or ideological about financial industry corruption. Warren, Sen. Sherrod Brown, and other Democrats were in high dudgeon during yesterday's hearing, but it's a positive development that Toomey and other conservatives made no effort to let Stumpf and Wells Fargo off the hook.There is, however, a catch in this case. As we discussed last week, Toomey may have said the right things yesterday, the Pennsylvania Republican has also said he doesn't want the Consumer Financial Protection Bureau -- the agency that identified Wells Fargo's misdeeds -- to exist.A week ago, the Philadelphia Inquirer reported that Toomey, facing a tough re-election challenge, "indicated in response to a question that he would like to see the [CFPB] dismantled." The conservative senator added that the agency is, among other things, "very ill-conceived and badly governed."What's more, last year, Toomey attacked the CFPB's budget and called for the repeal of the law that helped create the agency.All of this creates a context that shouldn't be dismissed too quickly: Toomey read Wells Fargo's CEO the riot act yesterday, but if Toomey had his way, there probably wouldn't have been a hearing because the Consumer Financial Protection Bureau wouldn't have uncovered the scandal in the first place.