The banks are being aided and abetted in their greed frenzy by pretty much every power center you can imagine: by the President, Congress and the judicial system. By the Treasury Department and the Office of the Comptroller of the Currency and most of the state attorneys general.
For homeowners beset by predatory mortgages and fraudulent foreclosures, there aren’t many allies left standing. Elizabeth Warren and Elijah Cummings in Congress. Eric Schneidermann, if he comes through. The Consumer Financial Protection Agency, we hope. And, of course, our old friends at the FDIC.
We’re taught from the time we open our first savings accounts as children or teens that the FDIC, the Federal Deposit Insurance Corp., is looking out for us, ensuring the money we deposit in financial institutions is safe and secure. Yep, the FDIC exists to serve consumers in case of bank insolvency or wrongdoing. Or not.
Turns out this purported regulator of the financial services industry isn’t looking out for us at all. In fact, it’s helping banks cover up their dirty deeds and has been for years. From the LA Times article on the subject:
“Critics describe the FDIC’s current practice of low-profile deal-making as a major departure from the S&L crisis.
“‘In the old days, the regulators made it a point to embarrass everyone, to call attention to their role in bank failures,’ said former bank examiner Richard Newsom, who specialized in insider-abuse cases for the FDIC in the aftermath of the S&L debacle. The goal was simple: ‘to make other bankers scared.'”
I’d just like to know what agency exists today that can make bankers scared of any of the sins they commit against their customers. Or a so-called regulator that actually looks out for the average citizen.
How can I make informed decisions about the financial institutions I trust with my money if the agencies tasked with informing me are actually in league with the industry to cover up wrongdoing? With the technology available today, I should have no problem steering clear of any company that doesn’t routinely do business fairly, ethically and legally. Yes, I can easily access a list of failed banks on the FDIC website. I should also be able to find information about banks that have been investigated for and found guilty of any kind of wrongdoing.
I should, for example, be able to access regulator’s databases for information on complaints against banks as easily as I can search at my local Better Business Bureau’s site. There I can find out whether a business I’m considering patronizing has a good rating or has been subject to customer complaints.
More important, I can also learn a bit about those complaints and how they were handled. Now one or two successfully closed complaints won’t necessarily cause me to shun a company. On the other hand, the fact that more than 5,500 complaints against Wells Fargo Bank were reported to the BBB over the past three years might give me pause. Especially because even with the BBB’s intervention, more than 800 of those were not resolved to the customer’s satisfaction.
Meanwhile, my credit union has an A+ rating from the BBB and has had zero complaints of any kind over the past three years. None. Not one.
By the way, while I was on my local BBB site I pulled up nationwide complaint and inquiry statistics for 2012 and found that banks and banking services generated nearly 500,000 consumer complaints, financial services created more than 800,000 public contacts and mortgage bankers, brokers and lenders together accounted for more than 2 million consumer inquiries and complaints.
And that’s just problems reported to the BBB, which admittedly doesn’t have the cachet or the influence to right consumer wrongs that it did a decade or two ago. But, apparently unlike most of the country’s attorneys general and seemingly every single bank and financial services regulatory body out there (including the FDIC), at least the BBB is still on the side of consumers. I think.
FDIC Secretly Settling Bank Cases For Years With ‘No Press Release’ Clause