On Tuesday, the Senate Banking Committee will hold hearings on the Wells Fargo fraud scandal, giving Sen. Elizabeth Warren, D-Mass., an opportunity to rip into the bank. But Americans deserve to see prosecutions, and lots of them—not political grandstanding.
Since 2011, thousands of Wells Fargo employees pursued compensation incentives by secretly opening millions of bank and credit card accounts using customer names and signatures without authorization. Debit cards and PINs were activated without consent. In some cases, employees conjured phony email addresses to enroll their victims in online-banking services. Some clients suffered major hits to their credit scores and may spend years repairing the damage.
The fraud was so common that employees had a name for it: sandbagging. Wells Fargo fired 5,300 employees involved in the scandal and refunded $2.6 million in customer fees associated with the unauthorized accounts. These are necessary first steps, but far from sufficient. What occurred was large-scale criminal fraud, not simply “aggressive sales tactics.”
Unfortunately, government agencies have responded by demanding their piece of the action, not by prosecuting wrongdoers.