did someone muck with the backend here

Re: Wells

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I really don't understand how journalists sleep at night. They somehow have this self-conception of being noble and important, but so many of them really are just the worst horrible people. Do Matt Lauer's friends still speak to him? What is wrong with the people at the AP?


Posted by: Unfoggetarian: "Pause endlessly, then go in." (9) | Link to this comment | 09- 9-16 7:43 AM
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On Wells Fargo, I just breathed smoke over a Bloomberg summary that tried to frame it as employees collectively getting one over on their bosses by artificially meeting ridiculous quotas. Which, maybe internally it was like that, but it minimizes the fact that it resulted in the theft of at least $2m from customers, so the machine was working as intended in the big picture.


Posted by: Minivet | Link to this comment | 09- 9-16 7:58 AM
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But you have to admit, this stuff about the Clinton Global Initiative brings up the distressing possibility that she might have potentially been in a position to consider doing things that Trump does constantly. (shoots self)


Posted by: Cryptic ned | Link to this comment | 09- 9-16 8:08 AM
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On Wells Fargo, I just breathed smoke over a Bloomberg summary that tried to frame it as employees collectively getting one over on their bosses by artificially meeting ridiculous quotas. Which, maybe internally it was like that, but it minimizes the fact that it resulted in the theft of at least $2m from customers, so the machine was working as intended in the big picture.

Well, sure, but as banks stealing from customers goes, $2m is chump change. PPI alone in the UK was tens of billions of pounds. And that's not considering perfectly legal stuff like overdraft fees or the way US banks handle debit card overcharging.


Posted by: Ginger Yellow | Link to this comment | 09- 9-16 8:46 AM
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I have no idea if it has changed or not, but the most surprising thing I found during my study abroad in the U.K. was that the only tangible result of spending more money than you have in your bank account was a polite letter asking you to make a deposit.


Posted by: Moby Hick | Link to this comment | 09- 9-16 8:50 AM
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Oh, absolutely. I mean about the recasting of any theft into "oh those scamp employees and their clueless bosses". And who knows, maybe $2m is just what's come to light so far.


Posted by: Minivet | Link to this comment | 09- 9-16 8:51 AM
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The bank has fired at least 5,300 employees who were involved.

This really bothers me. It seems obvious to me that most of those people were probably acting on orders from higher-ups, and complying because they needed the job. The shits who created the environment that encouraged fraud are almost certainly not among those fired.


Posted by: togolosh | Link to this comment | 09- 9-16 8:58 AM
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I don't see why the firings are wrong. If you create an incentive structure that could result in cheating that hurts customers, firing the employees who cheat is what good management is.


Posted by: Moby Hick | Link to this comment | 09- 9-16 9:02 AM
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The problem is the very long delay between the actions and the firing, which suggests there was no intention to protect consumers.


Posted by: Moby Hick | Link to this comment | 09- 9-16 9:02 AM
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8: The firings are right but almost certainly don't go far enough. The upper management that created that incentive structure should be fired and won't. In addition, just getting fired seems like an inadequate punishment, considering that those people probably have golden parachutes. I realize that the basic corporate system is designed to prevent that, but ideally it wouldn't. (I do agree with 4 that this is chump change, so I'm less outraged about it than I am about lots of other stuff in life, but outrage seems appropriate, in theory.)

I don't know they won't go far enough, and likewise maybe taking my life savings to Vegas would pay off just this once. But on the balance of probability...


Posted by: Cyrus | Link to this comment | 09- 9-16 9:25 AM
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Well, yes.


Posted by: Moby Hick | Link to this comment | 09- 9-16 9:25 AM
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It seems to be a general problem that our ruling class thinks "incentives work", but in reality they almost always work by people cheating. See also evaluating teachers based on standardized exam scores.


Posted by: Unfoggetarian: "Pause endlessly, then go in." (9) | Link to this comment | 09- 9-16 9:33 AM
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Or at least that incentives can somehow replace actually managing things.


Posted by: Moby Hick | Link to this comment | 09- 9-16 9:35 AM
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Did you all see the LA Times piece that outlines everything that's happened with this -- from 2013?! Executives AND regulators seem to have ignored their responsibilities here.


Posted by: Natilo Paennim | Link to this comment | 09- 9-16 9:39 AM
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WRT Trump, I saw a twitter post this morning comparing arguing with him with arguing against a pro se filing, which I suspect the lawyers here would appreciate. However, I am too lazy to actually find it.


Posted by: Tom Scudder | Link to this comment | 09- 9-16 9:43 AM
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12-13: The Wells Fargo case and the teacher cheating case - along with the housing bubble and banking crisis - are examples of incentives working brilliantly.


Posted by: politicalfootball | Link to this comment | 09- 9-16 9:43 AM
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I'm going to take the contrarian view and say that the media has been functioning much better than we could have expected.

The fact is, Lauer got an enormous amount of shit for fucking up those interviews. He's been embarrassed, and future moderators are going to have an incentive* to not be nitwits.

I don't know where you folks have been the last 40 years or so, but I've never seen this kind of accountability enforced on idiot moderators, or this kind of pressure placed on the media in favor of accuracy and accountability.

In the meantime, there's a lot of objective and appropriate contempt for Trump expressed in the media, and anybody who watched Lauer's stupid interview actually did get a good idea of who Donald Trump is.

*Incentives work! We'll see how strong the incentive is in this case.


Posted by: politicalfootball | Link to this comment | 09- 9-16 9:51 AM
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The problem is that there aren't good enough incentives for the people who make incentives. Surely the appropriate solution is a tax cut on capital gains.


Posted by: Spike | Link to this comment | 09- 9-16 11:29 AM
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The fact is, Lauer got an enormous amount of shit for fucking up those interviews. He's been embarrassed, and future moderators are going to have an incentive* to not be nitwits.

Maybe. In the meantime there's been a lot of pushback from (some in) the media along the lines of "Could you have done better as an interviewer, huh, huh? Trump is such a motormouth, with his misdirection and vague statements and such, it's really, really hard to actually fact-check him in the moment! It's a stumper!"

Well, no, it's not. You know, or should know, the kinds of statements he's going to come out with. Be prepared, eh? Lauer is not a professional journalist anyway. Bleh.


Posted by: parsimon | Link to this comment | 09- 9-16 5:45 PM
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This is like Spitzer going after the low-level broker during the mutual fund scandal. It's a way to blame the people at the bottom when it's obviously the people at the top that are to blame. Fabulous Fab was responsible for the mortgage crisis? I don't think so. For the CFPB to sit by while thousands of ordinary employees lose jobs and the district managers, the VPs, the CEO are off scot free, that's an embarrassment. 100% this not only comes with the implicit approval of the people at the top, the people at the top were giving directions on how to manufacture the fraud. Levine is wrong, this is not the low level employees sabotaging Wells Fargo, this is company policy that was expressly encouraged by upper management. I guarantee it. No low level employee goes in to work in the morning and says, I'm going to commit fraud today. The manager sits them down and shows them how to commit the fraud and then tells them to do it.


Posted by: bjk | Link to this comment | 09-10-16 4:28 AM
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One former Wells Fargo employee, who requested his name not be used so he doesn't hurt his career in banking, said he experienced this firsthand. He said managers told him to open unauthorized accounts and, when customers called, to apologize and say it was a mistake.
"This was not done by employees trying to hit their sales numbers, it was more of threats from upper management," he said, adding that workers feared they would lose their job.


Posted by: bjk | Link to this comment | 09-10-16 4:45 AM
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Wow, Levine is really wrong about this.

"But obviously no one in senior management wanted this. Signing customers up for online banking without telling them about it doesn't help Wells Fargo at all. "

Levine should know that what management cares about is the stock price. The whole reason that WF trades at a premium compared to JP Morgan or Citigroup is that it has a more profitable retail bank, and the profitability of the retail bank is tied to cross selling, so cross-selling (more accounts per customer) is the whole justification for the higher stock price. Management focused on opening bogus accounts so that it could claim that cross-selling was increasing every quarter. It was the whole rationale for Wells inflated stock price. The pressure definitely came from the CEO.


Posted by: bjk | Link to this comment | 09-10-16 5:36 AM
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Trump is such a motormouth, with his misdirection and vague statements and such, it's really, really hard to actually fact-check him in the moment! It's a stumper!

It's easy. Whatever he says, you respond, "I don't think that's entirely the case, Mr Trump." Because odds are it's a fantasy to start with, and if you make him elaborate the odds go from 75% to 99%.


Posted by: chris y | Link to this comment | 09-10-16 5:51 AM
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100% this not only comes with the implicit approval of the people at the top, the people at the top were giving directions on how to manufacture the fraud. Levine is wrong, this is not the low level employees sabotaging Wells Fargo, this is company policy that was expressly encouraged by upper management. I guarantee it.

Sure, but unless there's a paper trail documenting that encouragement it's not clear what anyone can do about it.


Posted by: | Link to this comment | 09-10-16 6:31 AM
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Aren't there like 5,000 people with plenty of incentive to tell their story? They might think silence will preserve their careers -- and maybe they're right, if their potential employers already know that they weren't trying to cheat for their own gain, but were following orders.


Posted by: CharleyCarp | Link to this comment | 09-10-16 8:03 AM
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Like these people:

"One former Wells Fargo employee, who requested his name not be used so he doesn't hurt his career in banking, said he experienced this firsthand. He said managers told him to open unauthorized accounts and, when customers called, to apologize and say it was a mistake.
"This was not done by employees trying to hit their sales numbers, it was more of threats from upper management," he said, adding that workers feared they would lose their job."


Posted by: chris y | Link to this comment | 09-10-16 8:24 AM
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I would just like to note that every time I load the main page, I get the stupid Music Man song stuck in my head. For hours or for days. So let's add that to the list of banking crimes.


Posted by: E. Messily | Link to this comment | 09-11-16 9:12 AM
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