The story has become all too familiar: A big financial institution screws up. Executives walk away with millions of dollars. Tens of millions of Americans end up holding the bag. The latest culprits are Wells Fargo and Equifax, and last week, Senator Brown led the Senate Banking Committee in pressing the companies for answers.
“Congress needs to stand on the side of working people, not Wall Street. These hearings are about getting answers for the people we serve,” said Brown.
Senator Brown demanded answers from Wells Fargo CEO Timothy Sloan about the company’s failure to detect millions of fraudulent accounts opened in customers’ names, as well as the company’s practice of forcing unwanted insurance on auto loan borrowers.
Brown pressed Sloan on Wells Fargo’s use of so-called forced arbitration clauses to block customers from seeking justice in the court system.
“Forced arbitration always gives the advantage to the bank, and you are continuing to use forced arbitration to take advantage of your customers. Why should we believe you are committed to changing your practices and being fair to customers when you continue to use closed-door arbitration practices that deny customers their day in court?” Brown questioned Sloan.
As the CEO side-stepped Brown’s question, the Senator interrupted, “Give customers their day in court.”
Senator Brown questioned former Equifax CEO Richard F. Smith in the wake of a massive data breach that exposed the data of 145 million Americans. According to Equifax, more than 5.2 million Ohioans were impacted by the breach.
Brown called for Equifax to invest more in security and less in huge salaries for CEOs. He pointed out that Equifax spent nearly as much on Smith’s multi-million dollar salary as the company spent on cybersecurity. Since last year, Smith earned about $69 million, while Equifax spends just $85 million a year on cybersecurity.
“In hindsight, do you think Equifax should have spent more money protecting peoples’ data rather than compensating you so well?” Brown asked Smith. “You’re an IT company. That’s just not acceptable.”