Lawmakers on Thursday intensified their calls for a wide range of investigations into Wells Fargo & Co. _ and into the practices of other banks _ as political fallout from the San Francisco institution's creation of unauthorized accounts continues to grow.
During a vitriol-filled, four-hour hearing on Capitol Hill, members of the House Financial Services Committee lambasted Wells Fargo Chief Executive John Stumpf, saying that his bank may have violated numerous federal laws and should be prosecuted for racketeering and that its sins should lead to a broad review of banking practices.
"Your colleagues should at least come forward," Rep. Brad Sherman, D-Calif., told Stumpf, referring to the CEOs of other major banks, adding that they, too, should be called to testify. "I don't think, Mr. Stumpf, that you should be alone in this joyous experience."
Stumpf faced an unbroken barrage of criticism from members of the committee and, beyond his opening statement, didn't do much talking, with committee members using most of the time they were allotted to ask questions to instead express a mixture of outrage and disappointment.
Democrats, in line with similar calls made last week by Sen. Elizabeth Warren, D-Mass., called for criminal prosecutions, with Rep. Stephen Lynch, D-Mass., saying the bank should be charged under the Racketeer Influenced and Corrupt Organizations, or RICO, Act, a statute originally designed to prosecute mob bosses.
"I do want to note that under the Racketeer Influenced and Corruption Act ... you've satisfied all the elements of that," Lynch told Stumpf. "No. 1 is fraud, and there is no question about that _ mail fraud, securities fraud, you've done it all. You've covered basically every aspect of fraud in your bank over the last five years."
Rep. Maxine Waters, D-Calif., said she would craft legislation to break up Wells Fargo and other big banks.
Several Republican members called for Stumpf to resign, saying the problems within the bank _ and the years it took for top executives to dig into the issue of fraudulent accounts _ make it more difficult for them to argue against what they see as overly restrictive financial regulation.
"Whatever ultimately legally comes out of this process, you just made it really hard for those of us who want to maintain the concept of a market economy, who want to continue to make sure that bankers, not some bureaucrat somewhere, are the arbitrageurs of capital," said Rep. Frank D. Lucas, R-Okla.
The hearing stretched on as more than half of the 60-member committee attended _ an unusually large turnout that speaks to the level of bipartisan outrage over the still-unfolding scandal that has spread well beyond Capitol Hill.
Wells Fargo is under federal investigation in New York and San Francisco, as well as by state and local authorities, according to a regulatory filing.
In California, state Treasurer John Chiang on Wednesday announced he would temporarily sever some business ties with Wells Fargo to punish the bank.
State Attorney General Kamala Harris also appears to be investigating the bank. Asked about the bank and sanctions against it issued by Chiang, Harris said, "I cannot talk about any of our investigations."
