Reply With Quote
yawn
Sounds like one of Hillary's good buddies.
yawn
fudging FX fees
https://www.bloomberg.com/opinion/ar...ed-some-digitsToday federal prosecutors announced a $72.6 million settlement with Wells Fargo Bank N.A. for overcharging business FX customers. Wells Fargo definitely did the standard, highest-price-of-the-day thing:
Furthermore, rather than charging the agreed-upon fixed spread to the FX market rate at the time the outgoing wire was converted, FX sales specialists would select the best rate for the Bank and worst rate for the customer from the FX price fluctuations from the beginning of the trading day until the time of the transaction. This practice was referred to internally as “Range of Day” Pricing.And here is how the complaint describes Wells Fargo’s pricing when it converted incoming wire transfers for customers:
Because Wells Fargo generally did not provide immediate notice to customers when they received incoming wires, known as BSwifts, Wells Fargo's FX sales specialists took advantage of this time delay to charge higher spreads than the Bank had represented it would.Fine sure right. But that is just a jumping-off point; once you’re making up prices, why not, you know, really make up prices?
One method used by FX sales specialists to extract large sales margins on BSwift transactions was to price them based on the range of the day. This practice allowed FX sales specialists to generate even larger spreads on incoming wire transactions than on outgoing wires. With outgoing wires, FX sales specialists could select the best price for the Bank and the worst price for the customer only from the beginning of the trading day up until the time of the transaction. However, with BSwift wires, because the customers generally did not know when the funds arrived in their accounts or when they were converted, the FX sales specialist could wait until the end of the day and cherry-pick the best rate for the Bank and the worst rate for the customer from the entire trading day.
In a written instant message to a colleague, an FX sales specialist analogized this fraudulent scheme to getting candy from a pinata, referring to the Bank's pricing of BSwift wire transfers as the "BSWIFT pinata."
For some customers, FX sales specialists also used what they internally called the "big figure trick" or the "transposition error game" to increase the FX sales margin and their profits. To carry out this scheme, the FX specialist would intentionally transpose the digits in the price of the transactions in a way that would result in the customers paying Wells Fargo a higher spread or sales margin.Man. I love writing about the complex stratagems that the world’s biggest and most sophisticated financial ins utions use to give themselves an edge. My favorite remains “if someone sends you money by accident, keep it,” but this one is pretty good too. “Switch the digits in a price to make it higher, and hope the customer doesn’t notice,” that’s high finance right there.
For example, hypothetically, if the actual correct price to purchase a Euro was 1.0123 dollars, an FX sales specialist would use the big figure trick to switch the price to 1.0213 dollars, thus taking more spread (in this example, an additional 89 basis points) from the customer.
If the customer actually caught the error, the FX sales specialist would falsely claim that it was simply a mistake.
One FX sales specialist explained in an internal communication with colleagues: "You can play the transposition error game if you get called out." Another FX sales specialist noted to a colleague regarding a previous transaction that a customer "didn't flinch at the big fig the other day. Want to take a bit more?"
crime is a social construct; bankers never go to jail for like this
plus ça change
If ever there were a candidate for the corporate death penalty, what does it take to lose your banking license?
HSBC was guilty of laundering $400 million for drug cartels but still kept its US banking license
https://www.justice.gov/usao-cdca/pr...nk-examinationThe former head of Wells Fargo Bank’s retail banking division has agreed to plead guilty to obstructing a government examination into the bank’s widespread sales practices misconduct, which included opening millions of unauthorized accounts and other products, federal authorities announced today.
In a plea agreement filed today in United States District Court, Carrie L. Tolstedt, 63, of Scottsdale, Arizona, agreed to plead guilty to one count of obstruction of a bank examination. Tolstedt is expected to make her initial court appearance in Los Angeles in the coming weeks, with the parties requesting the court to set a hearing for April 7.
The Office of the Comptroller of the Currency (OCC), which investigated misconduct at Wells Fargo, also has reached a resolution with Tolstedt in a regulatory proceeding. As part of the consent order resolving that matter, Tolstedt agreed to a ban from working in the banking industry and to pay a $17 million civil penalty.
pending approval of the deal by both sides, one banker will go to jail, 20 years after she first became aware of the shenanigans at Wells Fargo
The statutory maximum sentence for obstruction of a bank examination is five years in federal prison. Tolstedt has entered into a plea agreement which calls for a prison sentence of up to 16 months in prison, which prosecutors believe is the high end of the sentencing guideline range for the obstruction offense. The plea agreement is “binding,” which means the court must accept or reject all aspects of it. Should the court reject the plea agreement, including the agreed-upon sentencing range, any party may withdraw from it.
$250m fine for opening up fake credit card accounts and loading up customers with overrdraft fees.
another fine, this time for hiding official communications.
it's almost as if criminality and ripoffs are part of Wells Fargo's business model.
https://www.theverge.com/2023/8/8/23...sages-sec-fineSeveral US financial firms, including multiple Wells Fargo companies, will pay a combined $549 million in fines after admitting they couldn’t produce discussions about company business from smartphone messaging apps used by their employees, “including those at senior levels.”
Both the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) fined banks for being unable to produce discussions going back to at least 2019. The regulators say employees used their personal devices to discuss official company business via apps like iMessage, WhatsApp, or Signal and that those “off-channel communications” weren’t “maintained or preserved.”
Not keeping records of those conversations violates the 1934 Securities Exchange Act’s recordkeeping rules, as well as similar rules from the Investment Advisers Act of 1940, according to the SEC. The CFTC maintains its own recordkeeping requirements, which it says were violated.
The biggest chunk of the fines go to the Wells Fargo companies, which together will pay almost half of the SEC’s penalties at $125 million, along with another $75 million settlement with the CFTC.
That a bank can never do anything so heinous or so criminal that its license to do business will be taken away, Wells Fargo is pretty much living proof of. What blows me away is that apparently there's nothing it can do to ruin its reputation and its brand, either.
https://x.com/doctorow/status/1839661867155021992
Can't believe one of the people that CEO robbed didn't spray him with some buckshot.
There are currently 1 users browsing this thread. (0 members and 1 guests)
Posting Permissions
