Credo Action

Tell Congress: Break up Wells Fargo

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Petition to the United States Congress:

"Break up Wells Fargo and other too-big-to-fail banks by passing the ‘Too Big to Fail, Too Big to Exist’ Act."

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    Tell Congress: Break up Wells Fargo

    The second-largest of the nation’s too-big-to-fail banks is out of control. Wells Fargo recently paid $185 million to settle charges of scamming customers and creating fake accounts. Sen. Elizabeth Warren even told the company’s CEO to his face at a congressional hearing that he should be criminally investigated.1

    Top executives at Wells Fargo appear to have pocketed big bucks by boosting the price of company stock with claims about customers opening new accounts. They put intense pressure on employees – including requiring them to work nights and weekends – to hit sales quotas and appear to have looked the other way when some inevitably cut corners. Wells Fargo management fired the employees they forced to do the dirty work while executives walked away with millions.2,3

    The nation’s largest banks are bigger than ever, and the scams continue.4 We can’t afford to wait for the next Wells Fargo-type scandal and hope it doesn’t bring down the entire economy. We need to seize this moment and tell Congress to break up Wells Fargo and other big banks once and for all.

    Tell Congress: Break up Wells Fargo.

    Tens of thousands of CREDO members have backed Sen. Warren’s call for a criminal investigation and for Wells Fargo executives to return the money, and we will continue that fight. The fact that the Wells Fargo scandal came to light was also a victory for Sen. Warren’s Consumer Financial Protection Bureau, which we must continued to defend. But seven years after their criminal fraud nearly collapsed the global economy and they came crawling to the rest of us for a bailout, too-big-to-fail banks are actually bigger than ever.5

    The Wells Fargo scandal is just the latest. In just the past few years, large financial institutions have been caught rigging interest rates, manipulating foreign exchange rates, selling people misleading financial products, facilitating tax evasion and money laundering, and more.6 The expansion of high-frequency, algorithmic speculation and front-running has increased risks. In the “flash crash” of 2010, the Dow Jones industrial average dropped nearly 1,000 points in just minutes before rapidly recovering.7

    The largest banks are bigger than ever, they can borrow money at lower rates because the market assumes we will bail them out, and their reckless behavior continues. Rep. Brad Sherman, a Democratic congressman, has already introduced the “Too Big to Fail, Too Big to Exist” Act in the House, which would bust up the biggest banks.8 Now, it is up to us to force Congress to act.

    Tell Congress: Break up Wells Fargo.

    Rep. Sherman’s bill, and its companion bill from progressive champion Sen. Bernie Sanders in the Senate, would direct the government to compile a list of systemically important financial institutions, just as Dodd-Frank did. But it would also direct the Secretary of the Treasury to break up those institutions within one year and ban them all from receiving special help from the Federal Reserve or gambling with federally-insured deposits. Under this bill, JPMorgan Chase, Citigroup, Goldman Sachs, Bank of America and Morgan Stanley would all be broken up.9

    It wasn’t long ago that trust-busting and breaking up monopolies was considered common sense. We broke up the telecom giants as recently as the 1980’s. And today, breaking up big banks is supported by the Independent Community Bankers of America.10 In the wake of the Wells Fargo scandal, there are even fewer excuses for Congress’s inaction.

    Tell Congress: Break up Wells Fargo.

    Thank you for speaking out.

    1. Bill Chappell, “'You Should Resign': Watch Sen. Elizabeth Warren Grill Wells Fargo CEO John Stumpf,” NPR, September 20, 2016.
    2. Stephen Gandel, “Wells Fargo Exec Who Headed Phony Accounts Unit Collected $125 Million,” Fortune, September 12, 2016.
    3. David Dayen, “The Real Scandal at Wells Fargo: Execs Got Rich by ‘Sandbagging’ Clients,” The Fiscal Times, September 13, 2016.
    4. Rep. Brad Sherman, “Congressman Sherman and Senator Sanders Stand Together to Reintroduce 'Too Big to Fail, Too Big to Exist Act',” Sherman.House.Gov, May 6, 2015.
    5. Ibid.
    6. Five other banking scandals since 2008,” 4 News, February 9, 2015.
    7. Scott Gamm, “'Flash Crash' of 2010 Is History but Stock Markets Are Still Vulnerable, The Street, May 6, 2015.
    8. Sherman, “Congressman Sherman and Senator Sanders Stand Together to Reintroduce 'Too Big to Fail, Too Big to Exist Act'.”
    9. Ibid.
    10. Ibid.