September 20, 2016

Just in case you thought Elizabeth Warren didn't belong right where she is.

Just in case you thought it would be a "promotion" for Elizabeth Warren to be Hillary's running mate. (Really?)

And just in case you forgot all these banking bozos and the "independent" research agencies that rate them aren't STILL in bed with each other after the financial crisis of 2008, presenting the recipient of Morningstar's 2015 CEO of the Year award, Wells Fargo chief John Stumpf.

Each year Morningstar recognizes a chief executive who exhibits commendable corporate stewardship, demonstrates independent thinking, creates lasting value for shareholders, and puts his or her stamp on an industry.

Senator Elizabeth Warren differs. Business Insider is live-blogging the hearing:

11:26 - "Since this massive year's long scam came to light you have said 'I am accountable' what have you done to hold yourself accountable?" asked Elizabeth Warren. Warren asked if Stumpf had returned any of his compensation had come to light. "Have you returned one nickel of the money you earned while this scandal was going on?" asked Warren.

Stumpf did not respond. "I'll take that as a no," said Warren. Stumpf also said that he has not fired any senior executives as defined by Warren. "It's gutless leadership," said Warren.

11:30 - Warren said that cross selling, the practice of getting customers to sign up for new products from Wells, was designed just to "pump up the stock of Wells Fargo" and increase the value of Stumpf's stock-based compensation.

"You should resign, you should give back the money you made while this scam was going on, and you should be criminally investigated by the Department of Justice and the Securities and Exchange Commission," said Warren.

"The only way Wall Street will change is if executives face jail time after committing fraud."

Senator Elizabeth Warren needs to be in the Senate, on that committee, at least until the day that happens, if not forever. Amen.

UPDATE: In an open letter, Hillary Clinton sides with the CFPB:

....We need to defend the Consumer Financial Protection Bureau. The unfair and abusive practices at Wells Fargo remind us that we need tough watchdogs looking out for customers. The CFPB worked with local authorities and enforced the law – assessing its highest penalty ever, and bringing the bank’s illegal activity into the national spotlight.

Donald Trump, the Republican Party, and Wall Street lobbyists are desperate to dismantle this effective agency, 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.

Second, we need real consequences when firms on Wall Street break the law. This past week, we learned that one of the Wells Fargo executives that oversaw the division that ripped off its customers left the bank – not with a pink slip, but with a $125 million payout. It’s hard to imagine that top executives were unaware of a problem that involved thousands of the firm’s employees. After all, they imposed sales targets and compensation incentives in ways that led to this behavior. And it’s frustrating that a bank can simply pay a fine and keep doing business as usual – with massive compensation for the executives responsible. That compensation should be clawed back.

I’ve put forward an agenda to enhance accountability on Wall Street. Executives should be held individually accountable when rampant illegal activity happens on their watch. Their compensation should take a hit if their companies pay major fines. And they must face appropriate legal consequences if they break the law.

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