“As a result of the improper incentives and lack of oversight, a culture developed in which Wells Fargo FX sales specialists were comfortable repeatedly defrauding the bank’s customers,” the suit read. “FX sales specialists openly discussed and even celebrated transactions resulting in larger FX spreads than agreed to with customers and transactions generating large FX revenue.”
Wells Fargo ultimately reaped tens of millions of dollars in foreign exchange revenue by defrauding the customers, many of them small or medium-size businesses and banks, from 2010 through 2017, according to a complaint and settlement agreement filed by the Justice Department in federal court in New York on Monday.
The settlement of the lawsuit, which refers to a “brazen and wide-ranging fraud,” marks the most recent event in a half-decade-long saga for the firm. Problems first emerged in 2016 in the community bank and later multiplied across divisions, leading to billions of dollars in fines and settlements and the resignations of two chief executive officers. Wells Fargo is still subject to an asset cap from the Federal Reserve, limiting its size to its level at the end of 2017.
Some FX sales employees at Wells Fargo received bonuses of more than $1 million a year, while the bank failed to create safeguards and training procedures for how fixed-pricing agreements should be negotiated and implemented, according to the lawsuit, by the U.S. attorney’s office in Manhattan.
According to court papers, Wells Fargo defrauded 771 customers between 2010 and 2017 by systematically charging higher spreads or sales margins on foreign exchange transactions than it promised, and providing financial incentives to salespeople for the overcharges.
One would think that the S&P 500 Dividend Aristocrats possess pretty safe dividends, considering that all 65 of the companies have paid out higher disbursements for at least 25 straight years.
Barron’s, however, wanted to add another layer of protection and included another factor: the dividend safety ranking conferred by Simply Safe Dividends, a website geared to individual investors.