Wells Fargo Fiasco
Wells Fargo has found itself in quite a bit of hot water in recent years. In late 2016, it became public that Wells Fargo employees may have opened millions of deposit and credit card accounts in customers’ names without their knowledge. Despite having paid a hundred-plus million in penalties to consumer protection agencies, the bank endured a grilling by Congress and was forced to fire around a thousand employees.
A year and a half later, the bank is in the headlines again. Wells Fargo is being investigated by the U.S. Department of Labor for potentially encouraging customers’ purchase of more expensive retirement plans through Wells Fargo in lieu of lower-priced plans provided by customers’ places of work. Last Friday, it was announced Wells Fargo would have to fork out a whopping one billion in regulatory fines because of improprieties in its automobile lending and mortgage sectors.
The informed consumer likely looks at such news with extreme trepidation. For conscientious bankers, what does news like this mean for the way we view the behemoth lending institutions to which we entrust our savings?
We’ve seen time and time again in American history that the very civil society institutions many of us consider infallible are anything but. That’s not to say that inherent mistrust of any bank or similar societal stalwart is justified; plenty of corporations and large banking institutions operate in entirely good faith.
Spreading your savings around a variety of institutions to ensure your entire livelihood doesn’t rest in the hands of one individual bank is indisputably a solid choice. Similarly, having money in alternative investments, like precious metals, can insulate you not only from institutional failure but from a national financial crisis.
What’s perhaps most important, though, is militantly keeping on top of your finances. Make sure to check all of your accounts frequently, and investigate any potential discrepancies or quirks in your balance sheet. That’s not to say that you are entirely in control of the situation—there is, and always will be, some degree of trust in the system required—but you can dramatically improve your odds of sheltering your savings with due vigilance.