Fact is the CEO should have known what was going on. Any incentive program that has potentially perverse incentives needs to have appropriate audits to prevent fraud. And when you threaten to fire people based on hard to reach sales metrics, you have sufficient reason to expect fraud.
Even if the CEO didn’t know, all bonuses earned based on the fraudulently inflated sales figures should be returned, just as if I buy stolen property I have to return it, even if I didn’t know it was stolen.
I don’t see Warren on that list…
So what if the questions are rhetorical? If she had substantive unanswered questions and she prepared for this panel and still couldn’t find the answers she sought and turned at last to the CEO, would anything good have happened? Most likely the CEO would reply again and again, “Let me get back to you on that,” because he doesn’t have the answers either. The panel would have been a waste of time.
If enough of the powerful are held to account, is it possible the culture in this country might turn back away from complete impunity? It’s worth a shot.
The CEO said he is accountable, so I’d expect that to manifest in some form other than hand-waving. Of course it won’t, because these are banks we’re talking about, and in America, banks get away with murder. Shareholders won’t care unless the sanctions result in an actual stock hit. And I suspect that just about everyone in Washington is getting money from banks, so there is little political will to do anything meaningful.
No, it really doesn’t. Saying that one is fully accountable is the current trend in not being accountable. It is just a thing CEO’s and politicians say with no actual accountability behind it and generally corresponds with the “accountable” person blaming and firing other people, which is exactly what happened at Wells.
My point was poorly stated, but was basically that he’s telling Warren to her face that HE is accountable. And Warren is shining light on the fact that he is just hand-waving.
Sorry, bad parsing on my part.
Your contract does not stipulate clawback provisions. Executive contracts often do (so I’m told). If you did sign such a contract, well, maybe you shouldn’t have, or maybe such a contract is/should be illegal. I have to assume no CEO signs a $100M+ contract without having a lawyer explain it to him.
Remember Kenneth Lay, aka. “Kenny Boy”? He probably set the standard for the level of egregiousness to which one of America’s highest paid CEO’s must stoop in order for a grand jury to be convened.
Despite leaving a broad wake of financial misery and being convicted on six counts of conspiracy and fraud, he never served time. He died prior to sentencing, and his conviction was vacated a few months later.
Don’t forget Hugh McColl, who orchestrated the takeover of BofA by Nations Bank under the false guise of a “merger”. The board of the new corporation, eventually named Bank of America (because it tested better in surveys, to the chagrin of McColl), but actually decedent of Nations Bank, voted to give McColl a $75 million dollar bonus when he retired, a bonus not in his contract, just a “here, have $75,000,000”.
Corporate boards are incestuous, populated by executives from other corporations, who routinely abrogate their fiduciary obligations when handing out executive salaries and bonuses, with the full knowledge that the favor will be returned to them by their own board.
This isn’t a takedown, this is grandstanding.
She asked him some simple yes or no questions, and even those he evaded. There was no chance he would answer open ended questions. She showed him to be the weasel he is.
Right, but if you didn’t already think he was a weasel, you probably still don’t. And what’s the followup? What changes? How does it change? Who in a position to make that change will actually push for it?
Hopefully Warren will prove me wrong, but this just looks like a bunch of grandstanding to me.
I like that part where she says Nobody speak, nobody get choked.
We haven’t managed to prosecute the bankers responsible for the last market crash. Sen. Warren is, at worst, building momentum to either avoid the next incompetence/shenanigan instigated crash or successfully prosecute it if it’s not avoided.
I would argue that this most closely resembles the “Bounties for injuring opposing players” scheme of the New Orleans Saints. https://en.wikipedia.org/wiki/New_Orleans_Saints_bounty_scandal In this case employees were hounded if they didn’t make targets that were difficult if not impossible to make without cheating. And controls to find fake accounts are not difficult. http://www.nakedcapitalism.com/2016/09/wells-fargos-management-by-magical-thinking-comes-up-short-in-the-cover-up-category.html If he didn’t personally know, he certainly had subordinates who should have known. And they should not be leaving with golden parachutes. If nobody but the lowest level employees are ever punished this sort of thing won’t stop, because there’s no reason to find and stop this.
Anyone who’s got about 18 minutes should consider watching the (hardly trimmed at all) version on Sen. Warren’s youtube channel.
Based on what exactly? If they DO get along, I can only imagine it happening by Warren “leaning in” toward Hillary’s pro-Wall Street bent. Sorry, but what I quoted strikes me as a very empty statement. If you know otherwise, please inform.
Yeah, that sure sounds like a completely broken system. The only question I keep asking myself is how long does it last until it either collapses or is swept away (prolly with a lot of ugliness).
