Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge. When he's not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
The CEO of Ripple recently suggested that Wells Fargo did not receive the ‘FTX treatment’ despite exploiting its customers.
Ripple CEO Brad Garlinghouse recently likened the recent Wells Fargo fund management fiasco to the collapse of FTX. However, Garlinghouse disapproved of what he perceived as a hypocritical reaction to Wells Fargo’s case. According to the Ripple CEO, the leading American bank’s $3.7 billion fine for mismanaging customers’ interests was on the same scale as FTX’s monumental fall. However, Garlinghouse says the outrage directed at Wells Fargo turned out to be barely noticeable compared to the sunken crypto exchange.
The Ripple CEO took to Twitter to share his thoughts on the matter in a post that read:
“The world is (appropriately) outraged by SBF and FTX’s fraud, but when Wells Fargo mismanages billions in customer funds as well, it’s barely a blip on the radar. Food for thought…”
Garlinghouse’s tweet was accompanied by a popular comic book meme that alluded to the perceived double standard by government authorities.
Twitter Users Chime In on Ripple CEO Scathing Assessment of Wells Fargo Case
Garlinghouse’s criticism of the lack of attention directed towards Wells Fargo for its misdeeds garnered varied responses from Twitter observers. Although few questioned the meaning behind his verbal attack, a majority supported the Ripple CEO’s assessment of the Wells Fargo case. This majority support included insisting that relevant authorities should have extended the same FTX treatment to the prominent bank. In addition, some other users pointed out that the system favored traditional banking and finance over crypto-focused operations. Yet still, a few users also addressed the perceived double standard as proof that traditional banks’ own and control the government.’
Recap of the Latest Wells Fargo Case
Two days ago, the United States Consumer Financial Protection Bureau (CFPB) demanded that Wells Fargo pay a $3.7 billion fine. According to the consumer protection agency, Wells Fargo committed widespread mismanagement of auto loans, mortgages, and deposit loans. The CFPB also alleged that the San Francisco-based bank’s unethical conduct resulted in billions of dollars in financial harm to clients. This mismanagement also resulted in the wrongful foreclosure of homes and illegal repossession of vehicles, to name a few.
The CFPB’s hefty fine comprised over $2 billion in consumer redress and a $1.7 billion civil penalty.
Weighing in on Wells Fargo’s unlawful systematic fees and interest charges on its customers, CFPB Director Rohit Chopra stated:
“Wells Fargo’s rinse-repeat cycle of violating the law has harmed millions of American families. The CFPB is ordering Wells Fargo to refund billions of dollars to consumers across the country.”
In addition, Chopra suggested that this incident was not the first time the banking giant would violate the law. As he put it, “this is an important initial step for accountability and long-term reform of this repeat offender.”
According to reports, there are 16 million customers affected in the latest Wells Fargo case.
Previous Wells Fargo Infraction
In 2016, the multinational bank and financial services platform also received a $185 million fine from the CFPB. At the time, the agency accused Wells Fargo of creating countless fraudulent savings accounts for its customers without their consent. By 2020, the banking giant agreed to pay $3 billion to resolve all liabilities pertaining to the case.