Receiving Wide Coverage ...
More pressure on Wells: Two Democrat senators, Elizabeth Warren of Massachusetts and Robert Menendez of New Jersey, asked Wells Fargo's chairman if the board had sufficiently questioned Timothy Sloan about his knowledge of the bank's phony accounts scandal before appointing him chief executive officer. "It is difficult to believe that he had no knowledge of or bears no responsibility for the actions of thousands of Wells Fargo employees creating fake accounts," the senators' letter to Wells Chairman Steven Sanger said. "We continue to have questions about who is being held accountable at Wells Fargo."
The Board of Supervisors of San Francisco – where Wells is headquartered – is scheduled to vote next week on whether to cut off business with the bank. "It's disheartening to see our hometown bank was engaged in this sort of reckless behavior," said John Avalos, a member of the board.
The bank also lost its Better Business Bureau accreditation, which "means they no longer meet the standards of trust," a BBB spokesman in the San Francisco Bay area said. The bureau said it has received more than 4,000 complaints against the bank over the last three years and of the 107 customer reviews it has received, only four were positive.
Mexican immigrants who speak little English, older adults with memory problems, college students opening their first bank account, and small-business owners were among those targeted for fake accounts by Wells Fargo bankers, according to legal filings and statements from former bank employees. "The analogy I use was that it was like lions hunting zebras," said one former Wells employee. "They would look for the weakest, the ones that would put up the least resistance."
The scandal at Wells "took an even sharper toll on the company's workers," says the Times, which interviewed several former bank employees. "A number of them say they faced a stark choice: Create new accounts by any means possible, or risk being fired for falling short of their sales goals." And American Banker Editor in Chief Marc Hochstein says the Wells Fargo fiasco reveals a broken identity system.
Wall Street Journal
Paying the price: The billions of dollars in penalties that banks and other financial institutions have had to pay since the financial crisis – plus the additional millions in legal fees – have constrained global economic growth as banks reduced lending in response. "The roughly $275 billion in legal costs for global banks since 2008 translates into more than $5 trillion of reduced lending capacity to the real economy," Minouche Shafik, a deputy governor of the Bank of England, told a conference of regulators and bankers in New York.
PayPal-Alibaba deal: PayPal said it reached an agreement with Alibaba to make PayPal a one-click payment option on the Chinese e-commerce giant's AliExpress consumer marketplace. The news was included in the company's third-quarter earnings release, which said net revenue rose 18% compared to last year and net income climbed 7%, both ahead of forecasts. It also raised its revenue growth forecasts for the next three years. PayPal also said it would connect online accounts to its global remittance network, Xoom, making it possible to send cash to China, India, Brazil and other countries.
Prepaid cards gain: Prepaid card usage is growing among all U.S. consumers, both those with regular bank accounts and those without. According to the FDIC, 27% of households that have no access to the banking system said they used prepaid cards in 2015, up from 22% in 2013. Among all households, nearly 10% said they used prepaid cards, up from almost 8% two years earlier.
New York Times
Preemptive strike: Marketplace lenders have formed trade groups and hired lobbyists in an effort to prove they can enforce themselves "without the need for additional government intervention."