More on the incredible shenanigans that resulted in huge Wells Fargo Bank fines and a video that is Exhibit 101 for the sorry state of travel hacking!
TBB Blog Mission: To Entertain. Educate. Inspire. In That Order!
Well, I just could not keep away from saying hello to you guys…And here I am on a Saturday because, well, Wells Fargo Bank, that’s why!
I want you to really understand what went down at Well Fargo Bank. Here we go:
How exactly were employees ripping off account holders? There were four basic ways, according to the CFPB:
- Opening new deposit accounts and transferring customer money: As many as 1.5 million accounts may have been opened in the name of customers without their knowledge or permission. Employees would transfer customer money into these new accounts, subsequently generating $2 million in overdraft and other related fees.
- Applying for credit cards: Employees applied for about 565,000 credit cards on behalf of unwitting customers, who were then on the hook for annual fees, late fees, and interest charges that amounted to a little over $400,000.
- Activating new debit cards: Without permission, workers requested and issued new debit cards to account holders, often creating new PIN numbers for them in the process.
- Using bogus email addresses to sign people up for services: To enroll customers in online banking services without their knowledge, Wells Fargo employees would use email addresses unrelated to the account holder.
Okay, has that sunk in yet? If not, reread it. If still not, are you human or a robot or something, WTF! If you are a normal human being, that should make you REALLY angry!
I could go on but this guy has said it much better with the post titled “WTF WFC“. Some selected excerpts:
- The Chairman & CEO of Wells Fargo made $19.3 million last year, most of which came in the form of “performance bonus” pay. He made the same the year before. And what’s even better is that the company gets a write-off for paying that bonus in the form of stock options as opposed to cash, which means its effectively subsidized by taxpayers. Here’s how that works.
- Of the 5300 people fired, how many were just following orders, being pushed by upper management to do this in order to satisfy whomever is up the tree diagram from them? How many even knew they were doing something wrong? Were any senior people shown the door? Who is the highest ranking executive, if any, to have been thrown out?
- What happened here seems to be wholly consistent with one of the continuing messages of this blog – incentives explain everything… If you tie people’s pay or employment to a given outcome, you’re going to get more of that outcome. Which is fine, but there will be unintended consequences that may or may not be foreseen. In this case, ruthless new account opening targets led to 2 million fraudulently created accounts. Which is unbelievable, unfathomable. Until you remember that just a decade ago the same thing was happening with lending and mortgages.
- …This one involves ordinary people, lots of ’em. The scope of it is amazing, even if the dollar amount is not terribly consequential. Just the idea that something like this could be so widespread, within one of the most respected companies in America, is mind-boggling.
Okay, enough Wells Fargo. Lets continue with the sorry state of our hobby which is a DIRECT consequence of so many bloggers selling their readers out and pumping them to oblivion with the same credit cards they sell, well, pretty much every freaking day. This hobby has entered the mainstream. Here is proof, watch this video and weep! I blame these businesses. I am not angry, maybe a little pissed off as I eat my sandwich. HT: Sam
The Cult of the Chase Sapphire Credit Card on Bloomberg TV (Gulp!)
An old friend who used to troll my blog daily has reappeared, say hello to Rick I, former Frugal Travel Guy blogger. And please be respectful in your comments.
And an appropriate funny pic for today!
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Uno?
Wells fired 5,300 people? From where?
I was shocked when I saw the CSR article and comparing the best credit card headline popped up on my Bloomberg terminal.
Regarding the 5,300 number I responded to a comment in yesterday’s post. I think the figure is BS.
Her non response to the questions about continuing the 100k bonus is the stuff of legends 🙂
Morning, morning numero dos
You must be home then 🙂
Yep, for a spell…
That Chase lady smiles and it is not a smile. Serial starters? Targeting Millennials for luxury travel? That is sick imagining Millennials have not build any wealth yet. Clearly the most vulnerable group. Anyway, there are financial incentives to companies to provide level 3 data, correct? Internet searches coupled with monitored emails and L3 data will be able to reconstruct personalities. We have not had this precedent in history. Seriously consider using stealth methods for digital activities.
I don’t get how they target millennials when they state proudly they have not spend a dime on advertising…Anyways, like I said, we are not in Kansas anymore when you see clips like this…
A good point. Granted she is not making up anything what she is saying and they created this based on collected data. So they their ideal market clientele will first bite, and next generate debt where Chase collects. Is she actually mentioning TPG? Anyway mistakes of others usually work for us as that is how the game works.
I hope most or at least many of those 5,300 are pissed enough to start talking freely and filing CA lawsuits.
I think usually these types of settlements come with “we were wrong, we are sorry, here is some money, all forgiven, no more legal actions”
The WFC caper is truly mind-blowing, coming just a few years after the subprime mortgage caper. Whats more mind-blowing is out little attention its getting. One or two stories and done in most media. I guess we have the media’s crush on Don the Con to thank for that. And speaking of con man numero uno, one of the only coherent policy proposals he has issued is to eliminate the CFPB and the additional regulations placed on the big banks by Dodd-Frank!
I am seeing more attention now…I think it was a bit hard to really realize what went down here but now I see more coverage for it. And indignation. Here:
http://nymag.com/daily/intelligencer/2016/09/why-no-one-will-go-to-jail-over-wells-fargos-fraud-scheme.html
The ending captures the essence of it all and my views perfectly:
“I’ve been harping on this issue for at least the last four or five years — that at the end of the day, no one individual is held accountable.” At this point, he said, the country seems to be mired in a “double standard of justice” when it comes to crimes committed by banks. “If you or I failed to pay our federal income taxes, we could and would be indicted and convicted for a felony,” he said. “But if you’re working for a big bank and you engage in a huge, massive fraud scheme that generated hundreds of millions of dollars of criminal proceeds over an extended period of time, no one goes to jail. That strikes me as wrong, and it really undermines the public’s confidence in the criminal justice system.”
New reconsideration phone number for Chase, you may need it:
https://pointscentric.com/2016/09/10/new-chase-reconsideration-line-phone-number/
$100 million to the CFPB, $35 million penalty to the federal Office of the Comptroller, and $50 million to the the city and county of Los Angeles.
ONLY $5 MILLION TO CUSTOMERS, the real victims in this scam?? And the average payout is only $25??
And people wonder why WS is despised so much…
Many customers probably wasted hours trying to reverse the fees and close accounts…and dealt with credit and refinancing issues and on and on…so here is $25…that is so ludicrous!
Most valued and respected bank my ass! I bet their CEO gets a raise…mother fracker $19.3 million for two years in a row probably after hitting bonus target on “growth” metrics.
This shit drives me bananas!
What is the last symbol on the chart, right before the = infinity symbol?
It should probably be “= ymmv”
I think you are right…
Read Ingy’s post from yesterday. If you look back at his blog (even after he sold it) as a pure business, he did well. Even his “card suggestor tool” is , in a way, no different than what Wells Fargo was doing to its customers.
The only issue me (and probably *all* of us) had is that we readers didn’t really know they were running businesses. We looked at them as friends and advisors, and all of these blogger guys sort of built relationships with their readers by posting personal pics and travel stories, etc. Some of us then felt screwed when we learned that they were NOT impartial advisors, but businessmen ready to promote whatever was needed in order for them to make more money.
I believe most of them started out as good guy bloggers. Ingy was one of these guys and it was one of the first blogs I read. But he sold out (not necessarily a negative thing) just like many others, and some shady practices ensued.
Hope he’s happy with the path he went down. The money must be great but he’s got to feel a little dirty about it at the same time.
MMS and MommyPimp are the typical example of bloggers that you’re describing here.
>>>>>as a pure business, he did well
Maybe for his standards. Compared to the others who sold out later, NO WAY! Sold waaaaay too soon!
>>>>>>Even his “card suggestor tool” is , in a way, no different than what Wells Fargo was doing to its customers.
The tool was suggesting to EVERYONE to apply for 7 cards at once even when the person was looking for a cash back card recommendation. I tried MANY variations. Oh, had nothing to do with it, just continued to sell and collect 🙂
Your second paragraph is perfect and I agree 100%.
You think he sounds happy? What is the legacy here? The tool? The mailed in posts? The awful series…the one bribing users with $25 and using them as fodders to sell more credit cards? And do you remember when they jumped the gun on posting about First Friday?? That was so embarrassing…
I am speaking what I feel in my blog.
Hey John, come on man, using the word pimp, especially referring to a female, is just not nice.
This blogging thing gets so personal sometimes…We are our blogs sometimes I feel…
Ok, time to get to Toledo watch my daughter dance in the Greek Festival. And have some gyros and some beverages. Post is scheduled. And it is a lot more interesting than all the Titan blogs and way less revenue. But I like it 🙂
“Compared to the others who sold out later, NO WAY! Sold waaaaay too soon!”
I think you are off base here, George. In my personal finances, I work this way: I set a sell goal and, if it’s reached, sell it and NEVER worry or wonder later what could have been if I held on and sold later. I’m guess Ingy was “happy enough” and so what if he could have made more. For all we know, he invested his profits from the blog sale in Tesla stock and is now a billionaire.
You had me rolling on the floor on the “he invested his profits from the blog sale in Tesla stock and is now a billionaire.”! Awesome, thanks for the laughs.
“The money must be great but he’s got to feel a little dirty about it at the same time.”
I’d relate Ingy and WellsFargo. Too many role models nowadays for rationalizing ‘a little dirty behavior’ in the name of money. This begins and ends with the richest .1% (and their enablers) who are ‘role models’ for the next .9% and so on.
Inequality in the US today surpasses even the ridiculous inequality seen in the Robber Baron/Great Depression age. And when the pie shrinks that much there’s even more motivation to rationalize acting dirty.
Teach your children well.
Hey, you sound like Bernie Sanders!
My brother lives in Brazil. I have family in Greece. I know inequality and we don’t have it that bad here. Really. imho.
What a benighted response.
‘Things are worse elsewhere so don’t worry your pretty lil head about it.’
Hey, we have a difference of opinion on this, no big deal. Thanks for taking the time to comment.
Bluecat, a decent recap of events with just a few comments. The card suggester tool came AFTER I sold the blog and it was never my idea and I never supported it.
In regards to the sale I was very upfront about it the day it sold and it was no longer in my control. I made the decision to sell in the best interest of my family and although, TBB says it was too early (without any factual basis) I received about the same multiple as the other sellers and was still being compensated for several years after the sale.
A piece of advice: believe about 10% of what TBB speculates. He is corrected barely that percent of the time.
And feel a little dirty? Hell no. I took care of my family in one day for the rest of my life and theirs and the sale was disclosed the same day of the sale.That day, it you had your eyes open, you should have known the focus would become a 100% commercial venture. They paid good money for the privilege to do what they wanted.
It was fun while it lasted. I was compensated way beyond what I ever imagined when I started the blog, made lots of friends that I still have today, and helped others see the world at prices they could afford with some of the information I shared. And my timing was a close to perfect for me as I could imagine. With the younger more hip crowd jumping into the affiliate game four months before my sale was completed, I couldn’t be happier. It was obvious to me that the gravy train was unsustainable (as we are seeing now today) and the hobby would take a downturn.
The anger displayed here and in the blogger bashing forum on FT is in my opinion shallow and without much thought. Those that got in on the gravy train were in the right place at the right time and were not afraid to take a shot. They had no special talent. We were all just travel hackers, just like you, that took a chance when the timing and lighting were perfect. The BIG winners got in early and got out or are getting out long before now. Sorry Georgie Boy, you missed your spot,and all you got left, being so late to the game is to complain about others good fortune.
There is so little left of this hobby that got me around the world to 70 some countries it is hardly recognizable anymore. And I’m so glad I got in and out when I did. And as with the majority of others in the hobby we were glad to spread the word and let others enjoy the savings. It is only a very small group (thank God) that think once they learned the tricks of the trade the doors should be closed off to everyone else.
Rick,
I don’t think anyone is begrudging you for taking care of yourself and your family by selling the blog. If some people are, then they are really a-holes.
However, you kept dismissing people calling out the bs as “angries” and kept the bs facade with FTG. You can’t have it both ways being a “contributor” and then when being criticized saying “hey I sold it, that’s not me anymore.”
Buzz. I disagree. The amount of damage to this hobby MP has done was as bad as the titans. The woman went out on ABC nightline and the word “FREE” must have came out 50 times. And not once, but freaking twice. Are you freaking serious?
By the way George. It’s one thing selling credit cards. I remember MP was still engaging with people who were criticizing her, which was commendable.
Once she went full blown bullshit, she couldn’t even respond to criticism anymore because it was beyond defendable with a straight face.
The BS facade went on with FTG for years because his compensation depended on it….he was only saying “I sold, I have no control” BS in deranged comments here and in FT while the FTG facade sales mode went on and on, along with the bragging and the dismissal of angries etc.
I agree on your points about MP, I just don’t agree with the name calling and especially the word “pimp”. For the record. It gives rise to people like Rick and a few others who may not read all the comments here to justify (wrongly imho) that this is indeed a place where angries gather.
+1. I was among the stronest MP critics out there, but it’s about the BLOG, not the blogger.
When you stoop to personal attacks you lose the substance of your argument.
I don’t think you are correct about the “so little left of this hobby”—there is definitely enough to allow people to travel a LOT still. For me, there’s more than enough meat left there for my travel needs and I really can’t complain that some doors have been closed…so many others have opened!
Maybe you are referring to the spirit of “helping for helping sake” that every blogger had back before the credit card selling began. For sure, things have changed since then…as long as the consumer knows that these blogs went from “helping blogs” to “selling blogs”, it is more-or-less okay in my eyes.
When I wrote “feel a little dirty”, I meant that you went from “helping for helping sake” to “helping in order to make a sale”. The changes on your blog were rather gradual too, if I recall. So much so that I started to question how much of your writing *before* the actual sales date you were in “sales mode” versus “helping mode”. I mean, was I a sucker for your pics of your son and daughter travelling, etc., and not thinking you were passing off bad advice? I don’t think I’ll ever know….
There is still value in this hobby. But diminishing steadily and surely. The salvation is a great recession…sadly.
Let me answer the question for you. Yes, you were a sucker. FTG mode was to sell and maximize profits FIRST. It was since the day he cashed his first commission check from the credit cards. And you can take that to the bank!
Great discussion, I completely missed the good old days. I signed up for FT about ten years ago, but couldn’t make heads or tails of what they were talking about and never went back until recently.
To all:
No reason to engage in a logical manner with my biggest fan, Rick I. who has had an incredible fascination with my blog ever since I wrote negatively of the content and sales machine that defines FTG. The deranged comments over the years here are legendary, search back in some older posts that have over 100 comments and it is all due to him commenting away talking nonsense.
Anyways, I think it is entertaining to read comments like these and go WTF and smh to oblivion. People believe what they want to believe and there is no changing them whatever logical argument you make…which has been done many times here before. At some point, you just sit back, sip your coffee and LOL.
>>>>>>>>>TBB says it was too early (without any factual basis)
It was WAY too early. TOTAL was a pittance in comparison to what TPG and MMS got.
>>>>>>>>>A piece of advice: believe about 10% of what TBB speculates.
LOL. I will let you guys figure out who you should believe 🙂
>>>>>>>>>And feel a little dirty? Hell no.
Like there was ever any doubt!
>>>>>>>>>That day, it you had your eyes open, you should have known the focus would become a 100% commercial venture.
Yeah, you should have known, it is about responsibility you suckers. In the meantime, I kept selling credit cards, went along with every crappy sales gimmicky way to trick readers to buy more credit cards, playing along with the facade of the old hacker traveling frugally, phoning in lazy posts, cashing in paychecks for these lazy posts, increasing payouts from total sales and…disclosing i have no control over it ONLY at TBB and FT threads when challenged. Yeah Dorothy…
>>>>>>>>>The anger displayed here and in the blogger bashing forum on FT is in my opinion shallow and without much thought.
Yeah, sure, whatever you say. Keep thinking!
>>>>>>>>>>They had no special talent.
Obviously. But they developed one: SELLING to their readers non stop and targeting newbies by playing off the persona of “I am travel hacker, I travel for free, look at me, you can be just like me, all you gotta do is click on these cards, 7 at a time, yeah, keep clicking…every day”.
>>>>>>>>>>>>The BIG winners got in early and got out
Nope. If you are talking about BIG, the winners are TPG and MMS by far. And VFTW and OMMAT who keep milking it, may be a little harder to squeeze more $ now but make no mistake, they are much BIGger.
>>>>>>>>>>Sorry Georgie Boy, you missed your spot,and all you got left, being so late to the game is to complain about others good fortune.
Yeah, sure, whatever….All I got left, I mean, what else can you do but just LOL with stuff like that.
>>>>>>>>And I’m so glad I got in and out when I did
But, dear readers, he didn’t! He went on for years collecting paychecks for “content” and some % from total blog revenue. And make no mistake he would still be doing exactly that (collecting paychecks for phoning in posts) if the money was as good as before. But…it wasn’t so left for “editorial differences” years later. Yeah, right.
Okay, new comments in latest blog post please.
Last (sorry Dan)
Same old George. Same old Whine. Talk about getting under somebody’s skin? The joy from coming back for a visit is to watch you react, whine and rant. Works every time. Stay angry my friend.
Btw current Alexa is still 100k plus. You’ve got about 200 people just captivated George. Captivated
Who is Alexa? Is she hot? Are you her stalker?