Too Big To Jail?

Everyone wants the economy to bounce bank, and the President's not wrong to believe that the way to revive things is to boost confidence.

But if mass confidence is what it's gong to take, the people at the bottom of our economic pyramid need hope -- not only that they'll have jobs again and homes to keep – but protection against mortgage crooks – and restitution if they've been scammed.

The city of Baltimore is currently pursuing a suit against Wells Fargo.

Wells Fargo stands accused of disproportionately denying minority consumers favorable loans while targeting them for subprime ones with high interest rates, mandatory arbitration clauses and punitive prepayment penalties.

In court papers, Elizabeth Jacobson, who was one of Wells Fargo's top loan officers said, "Wells Fargo mortgages had an emerging markets unit that specifically targeted black churches, because it figured church leaders had a lot of influence and could convince congregants to take out subprime loans."

According to another bank officer, the bank even used software, "to translate marketing materials into various languages, including something called "African American." Tony Paschal (that second loan officer,) contends that the subprimes had sub-names -- "ghetto loans" -- their recipients "mud people."

This isn't small stuff. It's huge. Wells Fargo has faced similar complaints since the 1990s and Baltimore's just one example. Similar suits have been filed in Texas, Tennessee, and California. And Wells Fargo which denies the charges, is not alone. Joining them are most if not all of the nation's top bailout recipients including Chase Manhattan and Citigroup.

If the president really wants the economy to bounce back, confidence needs to be restored. Well here's a question: Wells Fargo -- which (according to the FCC) gave out nearly $1 million in campaign contributions and spent $3.6 million lobbying federal officials in the same period -- stands accused.

We've all become familiar with banks that are 'too big too fail'. Are some also too big to jail?

The F Word is a regular commentary by Laura Flanders the host of GRITtv which broadcasts weekdays on satellite TV (Dish Network Ch. 9415 Free Speech TV) on cable, public television and online at GRITtv.org and TheNation.com

Comments (14)

1. Posted by snowball666 at 06/10/2009 @ 09:45am

   Your urban dialect is a bit off snowball.

   Besides the racism, the question is about class. Why is it that those in the weakest positions get taken advantage of - and this equates to "good business"?

   And to those that would argue they could have chosen differently, care to explain to us your intimate knowledge of your credit card agreements, which likely have an arbitration clause in it? The terms for many financial instruments, as we have seen from the current financial crisis, are not always easy to understand.

   Posted by srjenkins at 06/10/2009 @ 10:01am

2. So, Wells Fargo sets up a special unit to market mortgages to subprime people and can't adopt tactics geared to where the subprime people are and the way they `hear' and `perceive' things.....guess they should just treat everyone exactly the same....of course, we know the Feds won't come after them anymore when lending to subprimers drop through the floor.

   What is the matter with you Lefties? Too little attention is discriminatory, normal attention is insensitive and too much attention is predatory!

   Sorry, this is so absurd that it's damn hilarious!

   Posted by Happy at 06/10/2009 @ 10:29am

3. The weakest get taken advantage of because their only protector -- the state -- is usually run by pols who've been paid off. Except where multibillionaires like Bloomberg buy the office for themselves & cut out the middleman.

   Nothing new there.

   Posted by sloper at 06/10/2009 @ 10:33am

4. Steal a hundred dollars and they'll put you in stir, Steal a hundred million, they'll address you as sir, Scientists will tell you it's a matter of bulk and size, Steal Manhattan Island and it's yours for a prize...

   Steal a silver teapot and you'll land in Sing Sing, Steal the Roman empire and they make you a king, So don't rob a bank, take the whole city hall, And never steal anything small...

   Steal a farmers chickens, you get shot in the rear, Steal a string of oil wells, you're a big financier, Every would-be burglar should engrave it upon his brains, If the theft is large enough it's capitol gains!

   Bribe a few policeman, you'll be covered with grief, Bribe the whole department and they'll make you the chief! You'll always be judged by the size of your haul, So never steal anything small!

   Posted by ficheye at 06/10/2009 @ 10:43am

5. Posted by snowball666 at 06/10/2009 @ 10:47am

   Maybe Michael Steele can help you out, snow. He's trying to teach hip-hop to Republicans!

   Posted by Mask at 06/10/2009 @ 10:57am

6. As Obama says, free marketers don't mind regulations to keep a toaster oven from electrocuting us but common sense in lending is socialist!

   They just can't stand when so-called capitalism doesn't obey the invisible hand and have to blame someone.

   Posted by winyahn at 06/10/2009 @ 8:03pm

7. common sense in lending is socialist!

   Posted by winyahn at 06/10/2009 @ 8:03pm

   In a free market, no one with common sense would loan money to the subprimers..........except like those strip center payday lenders, pawn shops and good ol' fashioned loan sharks.

   But Barney Frank and Chris Dodd and the Libs, created another type of `common sense' for banks: My way or the highway!

   Disclosure: For triple digit annual interest rate, HAPPY will consider forgoing his caliber of `common sense' and accept loan apps.....LOL!

   Posted by Happy at 06/10/2009 @ 10:04pm

8. Sometimes, economic downturns have a bright side, even if people don't recognize it. I would not call this a benefit.

   TORONTO - Beer maker Molson is turning off the tap and cutting off the supply of free suds to its retirees, the Toronto Star reported on Tuesday.

   Molson, a division of Molson Coors, said it was looking to "standardize" its complimentary beer policy.

   There are 2,400 Molson retirees in Canada and their free beer costs the company about C$1 million ($900,000) a year, the Star said.

   "There was no consultation, we just received a letter that this is a done deal, which is totally unfair," Bill Bavis, who retired six years ago after 32 years at Molson's in St. John's, Newfoundland, told the Star. "I think with the economic downturn they're trying to take advantage of us, as a way to cut retirees' benefits and justify it."

   Posted by Benchrest at 06/10/2009 @ 10:41pm

9. What is the matter with you Lefties? Too little attention is discriminatory, normal attention is insensitive and too much attention is predatory!

   Sorry, this is so absurd that it's damn hilarious!

   Posted by Happy at 06/10/2009 @ 10:29am | ignore this person | warn this person

   Three cheers for Barney, Dodd, and the other Demoncrats for holding the BANKS and financial services feet to the FIRE during mandated Federal Audits that DEMANDED that they loosem lending qualifications for the poor and ethnic neighborhoods! Now lets manufactor lies and punish them for doing what we told them to do!

   What LIARS and Hypocrits!!!!

   Posted by BigPasture at 06/10/2009 @ 11:42pm

10. You seem angry, Posture. Is your leash too tight?

    Posted by snowball666 at 06/11/2009 @ 09:02am | ignore this person | warn this person

    You ever stop to think who passed the laws making it LEGAL for any financial lenders, credit card co's., banks, to charge up to 30% annual intrest to gouge the citizens?

    Posted by BigPasture at 06/11/2009 @ 11:14am

11. Maybe Michael Steele can help you out, snow. He's trying to teach hip-hop to Republicans!

    Posted by Mask at 06/10/2009 @ 10:57am

    Why not utilize Ashcroft too? That man got rhythm! He even made the Big Yellow Canary swing with his cool vibe.

    Soar Eagle, soar.

    Posted by crabwalk at 06/12/2009 @ 10:56am

12. Let's assume for a moment that BP was anywhere close to reality and that Dodd and Co were soley responsible for the regulatory environment that helped create the sub-prime mess.

    OK, it was LEGAL for these companies to do what they did. Was it moral? Ethical? Done according to Judeau/Christian beliefs, standards or tradition?

    If you sought out some symbolic prophetism to guide the business practices, would you find liberalism at the core? Or would you find bad capitalism and greed? Or bat/birds?

    Posted by crabwalk at 06/12/2009 @ 11:03am

13. RIP, Carl Pursell.

    We could use some more repubs like you.

    Posted by crabwalk at 06/12/2009 @ 11:11am

14. So, Wells Fargo sets up a special unit to market mortgages to subprime people and can't adopt tactics geared to where the subprime people are and the way they `hear' and `perceive' things.....guess they should just treat everyone exactly the same

    Posted by Happy at 06/10/2009 @ 10:29am

    You've missed the point, Happy. Wells Fargo and Co. were "disproportionately denying minority consumers favorable loans" and steering them towards sub-prime loans instead. In other words, they were steering people of color who could have qualified for standard loans into sub-prime ones at a HIGHER rate than qualified white consumers.

    So, for the purpose of lending, if the applicants are equally qualified, YES, they should be treated the same.

    Posted by cka2nd at 06/12/2009 @ 3:46pm