The holidays are a time to break bread with friends and foes, to forgive and at least temporarily forget.
Yet despite months of penance, elected leaders aren’t ready to extend that holiday spirit to one bad actor: Wells Fargo.
The financial institution became synonymous with corporate greed after it agreed to a $185 million settlement with federal regulators earlier this year. Bank employees opened millions of fake bank accounts in the names of unknowing customers to hit aggressive sales goals.
Now Wells Fargo is being sued by customers and some former employees, who contend they were fired for not participating in the scheme.
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Since the news broke, Wells Fargo has been busy trying to clean up its image, taking out full-page apology ads in publications and outlining new actions to protect customers. But the fallout continues.
The banking scandal prompted state Treasurer John Chiang to suspend California’s investment business with Wells Fargo in late September. Last month, the Assembly Banking and Finance Committee held an oversight meeting in Calabasas to scold Wells Fargo and mull over legislation that would hinder a bank’s ability to use arbitration clauses to avoid lawsuits.
Today, the Senate piles on. Steve Glazer, chair of the Senate Banking & Financial Institutions Committee, is hosting a hearing to examine the bank’s illegal practices at 9:30 a.m. in room 3191 at the Capitol.
“I would also like to know whether Wells Fargo’s corporate governance structure needs revamping, whether incentive-compensation practices in other divisions of the bank could lead to similar wrongdoing, and what will be done to regain the necessary trust of the public,” Glazer, D-Orinda, said in a statement.
WORTH REPEATING: “Took him eight years but Barack Obama finally did something I can cheer about.” – Mike Madrid, California-based Republican strategist, on Obama honoring L.A. Dodgers broadcasting great Vin Scully.
BY THE NUMBERS: A 2014 voter-approved constitutional amendment, Proposition 2, requires California lawmakers to set aside money for reserves and debt payment. Just how much can be tricky to calculate and require “true-up” adjustments down the road. The Legislative Analyst’s Office recently estimated true-up requirements of $378 million for 2015-16 and $700 million for 2016-17. Yet lawmakers shouldn’t have to make any additional true-ups in the coming budget season. That’s because the current budget included an optional $2 billion for Proposition 2 – more than enough to cover the estimated true-ups for those years.
OH CHRISTMAS TREE: In one week from today Gov. Jerry Brown and California’s First Lady Anne Gust Brown will host a Christmas tree lighting ceremony at the Capitol for the first time since 2013. Heavy rains foiled the annual tradition in 2014 and Brown canceled last year following the San Bernardino shooting. This year a 60-foot-tall white fir will be adorned with 10,000 ultra-low-wattage LED lights and 900 ornaments hand-crafted by children and adults with developmental disabilities. A pair of 7-year-old twins, Alex and Alan Rosales of Los Angeles, will help the first couple illuminate the tree, while Kitty O’Neal of KFBK Radio emcees the event. The ceremony begins at 5 p.m on the west steps.
T-MINUS 7 DAYS: Stay tuned this week for news about SEIU Local 1000’s strike threat. California’s largest state-employee union has been unable to reach common ground with the Brown administration in ongoing contract negotiations. Local 1000 said it’s prepared to strike on Dec. 5, the same day as the swearing-in ceremony for the state Legislature, if Brown refuses to budge on a 12 percent wage increase and proposal that employees fork out more for health benefits.
Jim Miller of the Bee Capitol Bureau contributed to this report.