In October 2017, The Crime Report said that “white-collar crime is a growth industry.” The Wells Fargo Bank scandal illustrates this point more than any other corporate crime in modern American history.
Last September Steve Hochstadt, writing in the LA Progressive, went so far as to call Wells Fargo “the biggest criminal enterprise in American history.” The month before Harold Meyerson, editor of the American Prospect, opened an op-ed piece in the Los Angeles Times with these questions:
“What’s the biggest criminal enterprise in California? MS-13? The remnants or successors of the Crips and the Bloods? The Mexican Mafia? If we’re talking about the sheer volume of offenses, the answer is clear: Wells Fargo.”
Wells Fargo Criminal Enterprise Makes MS13 Look like the Little Rascals
Yet no one with Wells Fargo Bank has gone to prison?
Why?
TracReports recently pointed to the answer when it reported that white collar crime convictions in 2017 decreased by 11 percent from 2016 and have decreased nearly 30 percent since 2012.
In other words, prosecutors at both the federal and state level have responded to the growth industry of white collar crime with fewer prosecutions, and with lower prison sentences when there are convictions.
Banking Industry Lobbies Generously, Prosecutions Down 46%
Writing in The American Interest last November, James S. Henry pointed out that in 2016 U.S. financial services industry spent $1.44 billion on “Federal contributions and lobbying” with the U.S. Congress: “about $7,373 per Congressman per day.”
This disguised “pay to play” money has effectively compromised the prosecutorial system in white collar crime. Cases. As Henry explained:
“ … For example, as of 2017, the number of ‘white collar’ criminal prosecutions and convictions is at the lowest level in 22 years. Indeed, during Trump’s first year, so far, there have only been about 6,000 Federal white-collar criminal prosecutions of all-kinds—a 46 percent drop from their 1995 total (10,913), and just 6 percent of total Federal criminal prosecutions. Bank fraud cases will account for only 8 percent of all Federal white-collar crime prosecutions.”
This preferential treatment white-collar crime has received is not confined to the Trump administration, as Henry rightfully noted:
“It is important to note that this negative trend is not peculiar to the Trump Justice Department. Under the Obama administration, Federal white-collar criminal prosecutions peaked in 2011 at
10,100, and then fell dramatically to 6,240 in 2016. Bank fraud cases accounted for less than 6-8 percent of all white-collar crime rates during this period—which, in turn, accounted for just 5-6 percent of all Obama Justice Department criminal prosecutions.”
Bi-Partisan Support for Financial Services Industry
These prosecution figures offer ample evidence that the financial services industry money has no preference for red or blue: it sees only green.
Yet on March 1, 2018, Deputy Attorney General Rob Rosenstein, in a keynote address before the American Bar Association’s 32nd Annual National Institute on White Collar crime in San Diego, pointed to the “many” white collar crime investigations underway by the U.S. Justice Department, according to the San Diego Union Tribune.
The newspaper underscored these remarks by Rosenstein:
“When it comes to cases against large corporation, Rosenstein said it is a balancing act, ensuring individual wrongdoers are held accountable while avoiding imposing penalties that disproportionately punish innocent corporate shareholders and employees.”
Prosecutors Protecting Shareholders
The Deputy Attorney General added that stiff corporate penalties are imposed when appropriate.
“We ask this question,” Rosenstein told the attendees, “which people of organizations provided the necessary goods or services to criminal enterprises—then we seek to hold them accountable for any criminal violations.” He pointed to a recent case being prosecuted by the U.S. Attorney’s Office in San Diego against a California subsidiary of Rabobank. In a guilty plea last month, the bank admitted to ignoring regulations that prevent money laundering by drug cartels and agreed to a $360 million settlement.
Evidence of Wells Fargo’s Criminal Conduct
Hochstadt described just a few of Wells Fargo’s crimes:
“Wells Fargo employees created 3.5 million fraudulent accounts in customers’ names without their knowledge. The bank signed up 500,000 customers for online bill payment services without their knowledge, some of which carried fees. It charged military personnel illegally high interests on loans and then seized vehicles from soldiers who fell behind on their payments. It charged half a million auto loan customers for insurance that they did not need. About 20,000 people could not pay these extra fees, went into default, and had their cars repossessed.”
Yet not one single person has spent a single day in jail or prison for any of this criminal activity committed by the nation’s second largest bank.
However, the arrest of law-abiding, non-criminal immigrants has doubled under the Trump administration. Government officials continuously parade through the nation’s 24-hour news cycle the false narrative that these immigrants are dangerous criminal, but the Justice Department cannot find either the evidence or courage to indict one Wells Fargo official who has stolen money from law-abiding Americans, many of whom had just returned from fighting this nation’s wars across the globe.
The old mantra “money talks, bulls..t walks” certainly applies to the Trump administration, especially with its handling of the Wells Fargo Bank scandal.