Senate Democrats Press Lynch to Investigate Wells Fargo Officials

Letter wants Justice Department to look into their actions in fake accounts scandal

Democratic senators' letter to Attorney General Loretta Lynch says that bank executives largely escaped financial accountability after the 2008 financial crisis. (Tom Williams/CQ Roll Call file photo)
Democratic senators' letter to Attorney General Loretta Lynch says that bank executives largely escaped financial accountability after the 2008 financial crisis. (Tom Williams/CQ Roll Call file photo)
Posted October 5, 2016 at 10:21am

Senate Democrats have written to Attorney General Loretta Lynch pressing the Justice Department to specifically investigate the actions of senior Wells Fargo officials in the recently revealed scandal about fake accounts.

“While the Consumer Financial Protection Bureau and Office of the Comptroller of the Currency settlements in this case are a good first step toward providing restitution to Wells Fargo’s customers, they are no substitute for a thorough Justice Department investigation into potential wrongdoing by senior executives at the bank,” wrote the 14 Democratic caucus members, led by Mazie K. Hirono of Hawaii.

The letter cites a September 2015 memorandum from Deputy Attorney General Sally Yates in which federal prosecutors across the country were directed to pay more careful attention to individuals involved in the kind of large corporate cases like the current situation with Wells Fargo.

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The Justice Department drew wide criticism, especially on the left, for a lack of prosecution of individual executives related to the issues with mortgage-backed securities in the 2008 financial crisis. Among the signatories are Sen. Patrick J. Leahy, D-Vt., who is the ranking member on the Senate Judiciary Committee, as well as Sen. Elizabeth Warren, who largely created the consumer bureau and has been an outspoken critic of financial regulators.

″Following the 2008 financial crisis, the American people watched as senior executives repeatedly escaped accountability for actions that nearly brought down the global economy. No top Wall Street executives went to prison or even faced prosecution. Instead, the government regularly settled for a penalty that was borne by the bank’s shareholders, not its executives. Even that penalty tended to pale in comparison to the profits the bank generated from its illegal activity,″ the lawmakers wrote.

The other senators signing the letter are Democrats Tammy Baldwin of Wisconsin, Richard Blumenthal of Connecticut, Richard J. Durbin of Illinois, Al Franken of Minnesota, Kirsten Gillibrand of New York, Amy Klobuchar of Minnesota, Edward J. Markey of Massachusetts, and both Jeff Merkley and Ron Wyden of Oregon. The two independents who caucus with the Democrats, Angus S. King of Maine and Bernie Sanders of Vermont, signed on as well.