'A toothless police dog in action': Comments of the week

November 1, 2018 10:00 PM

Readers respond to an FTC settlement with SoFi, weigh calls to simplify Wells Fargo, consider crypto's revolving door and more.

A customer exits a Wells Fargo & Co. bank branch in Los Angeles, California, U.S., on Thursday, April 19, 2018. Wells Fargo & Co.'s financial ties to gunmakers and the National Rifle Association have prompted the American Federation of Teachers to remove the bank from its list of recommended mortgage lenders. Photographer: Patrick T. Fallon/Bloomberg

Patrick T. Fallon/Bloomberg

On an argument that the Fed should consider streamlining Wells Fargo's structure to help address its compliance issues:

"[The author] is certainly correct in citing the options available under the law; however the conclusion that divesting Wells Fargo's nonbanking activities would somehow "allow Wells Fargo to focus on fixing its persistent problems" seems a stretch. The bank has made numerous changes and no doubt many more are both needed and many more will happen, but in the end, the regulators are most interested in having a healthy financial institution. Focus isn't the problem. Execution is the challenge."

Related: Fed should force Wells Fargo into being a simpler bank

Tim Sloan, president and chief executive officer of Wells Fargo.

Another reader weighs in on an argument that Wells Fargo should lose its financial holding company status:

"Wells Fargo has an enormous amount of hubris and sometimes the tail wags the regulatory dog. They should be taken down a peg. However, calling for the head of the country's third largest bank is the kind of knee jerk reaction that is not needed. This is not Alice's Adventures in Wonderland. Sadly, this blind fury position is too often held amongst liberal community activists. Hopefully sounder heads will prevail and the baby will not be thrown out (in protest) with the bath water."

Related: Fed should force Wells Fargo into being a simpler bank

Mick Mulvaney, acting director of the Consumer Financial Protection Bureau (CFPB), speaks during a Senate Banking, Housing & Urban Affairs Committee hearing in Washington, D.C., U.S., on Thursday, April 12, 2018. Senator Elizabeth Warren clashed with Mulvaney, accusing the former GOP congressman of putting politics ahead of protecting consumers. Photographer: Toya Sarno Jordan/Bloomberg

Toya Jordan Sarno/Bloomberg

On the Federal Trade Commission's settlement with SoFi over charges that it misled borrowers regarding how much they could save by refinancing their student loans:

"A toothless police dog in action. No civil money penalty for 'deceptive' ads!?!. And where is the CFPB and state regulators in all this? I hope the FDIC paying attention."

Related: FTC puts student lenders on notice by citing misleading ads at SoFi

On Margaret Keane, president and CEO of Synchrony Financial, predicting that plastic cards could go out of style in as little as five years:

"Where can we place our bets on plastic cards still being here in 5 years? I'm all in. Heck, make it 10 years. There are lots of folks out there with solutions in search of problems. The incredible majority of customers are absolutely happy with how their plastic cards work. Many, I'd also wager, will be extremely hesitant to rely entirely on their phones for payments."

Related: Plastic cards will be gone in five years: Synchrony CEO

A recent court ruling in Illinois advances a conspiracy case against prominent Wall Street banks.

On a look at the trend of former regulators taking on advisory roles at cryptocurrency firms and the potential risks involved:

"Spoiler alert - fast forward a couple years to the likely class action lawsuits in this sector and you'll see why several of these folks were wise enough to take on the role of 'advisor' as opposed to 'director'."

Related: The problems with crypto’s revolving door

The Marriner S. Eccles Federal Reserve building stands in Washington, D.C., U.S., on Friday, Nov. 18, 2016. Federal Reserve Chair Janet Yellen told lawmakers on Thursday that she intends to stay in the job until her term expires in January 2018 while extolling the virtues of the Fed's independence from political interference. Photographer: Andrew Harrer/Bloomberg

Andrew Harrer/Bloomberg

On Democratic lawmakers calling on the Fed to implement real-time payments in an effort to help low-income Americans living paycheck to paycheck:

"While I think movement to a real-time payments system is really swell, I am at a bit of a loss to understand how it will address wealth inequality in our society. Income will remain the same, while delivery of payroll will happen more quickly. Great. But absent a change in compensation, or a reduction in liabilities, the same amount will simply be expended at greater velocity. If the individual's income does not cover their monthly expenses, they'll still be short. Just more quickly."

Related: Congressional Black Caucus members urge Fed action on faster payments