Wednesday, September 28, 2016

"Wells Fargo Whistleblower Claims Get New Scrutiny in Labor Review"

"U.S. Labor Secretary Thomas Perez said his agency will conduct a top-to-bottom review of claims against Wells Fargo, including those of whistleblowers whose cases were settled.

The U.S. Labor Department will re-examine six years worth of whistleblower cases against Wells Fargo  (WFC) amid a comprehensive review...

"I have directed enforcement agencies within the department to conduct a top-to-bottom review of cases, complaints or violations concerning Wells Fargo over the last several years," Labor Secretary Thomas Perez said in a Monday reply to U.S. Sen. Elizabeth Warren's request for a probe... The department has also created a Web page with information about worker-protection laws for bank employees at www.dol.gov/wells fargo.

Says "Page not found

I left messages after about four phone calls to people at the DOL
who had no idea what I was talking about

..."I'm glad the Department of Labor is initiating a prompt and thorough agency-wide review" to determine whether additional claims against the bank are warranted, Warren said in a statement Tuesday.  "Every other federal agency with jurisdiction in this matter should follow the Labor Department's lead and promptly determine whether Wells Fargo and its senior executives should be prosecuted or otherwise sanctioned."

Probably won't happen,
as the 'other' federal agencies were in on no one going to jail

https://www.thestreet.com/story/13754053/1/wells-fargo-whistleblower-claims-get-new-scrutiny-in-labor-review.html
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Wells Fargo defrauded, recommitted and is currently committing fraud on thousands of Wells Fargo clients whose accounts are governed by The Investment Advisors Act of 1940 via misleading Envision financial plans updated without matching Envision financial plan asset allocation models to investment accounts, so Financial Advisors could qualify for the 4front incentive bonus' after the Wells Fargo Wachovia merger.

In 2009, while in possession of TARP monies, Wells Fargo initiated a pattern of the use of a device and scheme to defraud the U.S. government and clients with more than $250,000 held at Wells Fargo, by omitting to state material facts necessary in order to make statements made by hundreds if thousands of Envision plan reports delivered by wire and the mail, created by thousands of financial advisors, in the light of the circumstances under which they were made, not misleading via the 4front Envision plan related financial advisor retention bonus program...in violation of federal laws.

Many of the households whose accounts were/are governed under the Investment Advisors Act of 1940 were used to get the 4front bonus', which makes it illegal, as Financial Advisors were compensated over and above what was disclosed to clients via the use of misleading information.

Section 206 of the Investment Advisors Act of 1940 states "It shall be unlawful for any investment adviser, …to employ any device, scheme, or artifice to defraud any client or prospective client;  to engage in any transaction, practice, or course of business which operates as a fraud or deceit upon any client or prospective client; or...  to engage in any act, practice, or course of business which is fraudulent, deceptive, or manipulative."

If about 10,000  Financial Advisors had to do a minimum of 25 Envision Investment Plans on households worth at least $250,000 to receive Wells Fargo 4Front compensation retention bonus' after Wells acquisition of Wachovia, and the average assets held by households that received 4Front Envision plans was/is about $450,000, and the average number of qualifying for 4Front Envision Plans was/is about 35 per Financial Advisor, and if about 10,000 FA's created about 35 plans each = 350,000 4Front Envision Plans, and about 350,000 x what could be about $450,000 of assets held for each household = $157,500,000,000, meaning it looks like it happened to more than $150 billion of Wells Fargo Advisors client assets, much of which was covered by fiduciary obligations under the Investment Advisors Act of 1940, which made the scheme illegal.

As a fiduciary, Wells Fargo is currently defrauding and recommitting fraud on what appears to be hundreds of thousands of clients, many with accounts governed by The Investment Advisors Act of 1940, via misleading Envision financial plans created to qualify for the 4front incentive bonus and updated without including charged investment costs in projected minimum client goals.

I believe Wells Fargo violated the following laws;

29 U.S. Code § 1104 - Fiduciary duties

8 U.S. Code § 1343 - Fraud by wire, radio, or television

17 CFR 240.10b-5 - Employment of manipulative and deceptive devices

15 U.S. Code § 77q - Fraudulent interstate transactions

15 U.S. Code § 80a–35 - Breach of fiduciary duty

15 U.S. Code § 80a–47 - Liability of controlling persons; preventing compliance

15 U.S. Code § 80b–6 - Prohibited transactions by investment advisers

17 CFR 240.10b-3 - Employment of manipulative and deceptive devices by brokers or dealers

15 U.S. Code § 78t - Liability of controlling persons and persons who aid and abet violations
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On January 17, 2008, unknown to shareholders but known to Wells Fargo CEO John Stumpf and Chairman Richard Kovacevich, Wells Fargo borrowed $1.666 billion from the Federal Reserve Bank's Term Auction Facility at 3.95% interest, with $47.930 billion in Unencumbered Collateral representing an undisclosed credit line with the Fed, none of which was disclosed by Wells Fargo's 2008 annual report.

On May 22 2008, unknown to shareholders but known to Wells Fargo CEO John Stumpf and Chairman Richard Kovacevich, Wells Fargo borrowed $7.5 billion from the Federal Reserve Bank's Term Auction Facility at 2.1% interest, with $47.197 billion in Unencumbered Collateral representing an undisclosed credit line with the Fed, none of which was disclosed by Wells Fargo's 2008 annual report.

WFC's 2008 annual report cites the words "Term Auction" 0 times, and "TAF" 0 times, with no mention of the overall size of WFC's Federal Reserve Term Auction Facility credit lines, interest rates and maturities, all of which were material inside information known to Wells Fargo CEO John Stumpf and Chairman Richard Kovacevich but not WFC shareholders, Congress, or the public.

On 2008-05-15, while WFC was in possession of undisclosed Federal Reserve provided Term Auction Facility loans, Stumpf John G. purchased 1,550 of Wells Fargo stock valued at $44,841  without being arrested for Insider Trading and Securities Fraud.

On 2008-06-06, while WFC was in possession of undisclosed Federal Reserve provided Term Auction Facility loans, Kovacevich Richard M. purchased 40,398 of Wells Fargo stock valued at $1,052,367 without being arrested for Insider Trading and Securities Fraud.

Sarbanes Oxley (SOX) states;

"SEC.302. CORPORATE RESPONSIBILITY FOR FINANCIAL REPORTS.

    (a) REGULATIONS REQUIRED ...the principal executive officer or officers and the principal financial officer or officers, or persons performing similar functions, certify in each annual or quarterly report filed or submitted under either such section of such Act that--

    (2) based on the officer's knowledge, the report does not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which such statements were made, not misleading..."

I believe CEO John Stumpf and Chairman Richard Kovacevich are guilty of Securities Fraud and Insider Trading, with the consent of the Federal Reserve, the SEC etc... and the Justice Department.

Notice the City of Los Angeles filed suit, not anyone at the federal level.

On March 27, 2008, Wachovia borrowed a undisclosed $3.5 billion from the Federal Reserve’s Term Auction Facility (TAF), with unencumbered Assets, representing a Fed credit line worth $53.652 Billion, which was never reported to the SEC, shareholders or the North Carolina business court which reviewed the Wells Fargo, Wachovia merger.

On 6/30/2008, Wachovia's outstanding Federal Reserve provided Term Auction Facility borrowings totaled $10 billion, representing a material 29.82% of the company's market capitalization.

Wachovia Corporation's June 30, 2008 form 10-Q certified by Robert Steel did not disclose the type, terms, interest charges, dates, collateral, values or amounts of financial assistance provided by the Fed.

On July 22, 2008, Mr. Steel personally purchased 1,000,000 shares of Wachovia’s stock as the company’s undisclosed Federal Reserve Term Auction Facility (TAF) borrowing reached $12.5 billion, representing a material 34.85% of the company's market capitalization.

On September 23, 2008, Goldman Sachs announced Warren Buffett, who owned 9.2% of Wells Fargo in 2007, purchased $5 billion of Goldman Sachs perpetual preferred stock warrants to purchase $5 billion of Goldman Sachs common stock.

"We view it as a strong validation of our client franchise and future prospects," said Lloyd C. Blankfein, Chairman and CEO of The Goldman Sachs Group, Inc.”

Wachovia CEO Robert Steel falsely certified Wachovia's Quarterly Report as of September 30, 2008, as the $12.5 billion borrowed by Wachovia on 9/30/2008 represented a material 165.43% of the companies market capitalization;

The Federal Reserve unanimously approved Wachovia's merger with Wells Fargo on October 12, 2008, as Wachovia's Fed Discount Window borrowings were a material 449.72% of the company's market capitalization.

On October 31, 2008, the Federal Reserve was aware Wachovia and Wells Fargo CEO's Robert Steel and John Stumpf lied in a merger related SEC filing.

Wachovia's stock price on date of first TAF loan: 3/27/2008 - Last Trade: 27.07

Wachovia price on date of completed merger with Wells: 12/31/2008 - Last Trade: 5.54

As of January 31, 2008, there were 1,981,983,990 Wachovia shares outstanding.

27.07 - 5.54 = 21.53 x 1,981,983,990 = $42,672,115,304.70 Wachovia market capitalization lost between the first undisclosed TAF loan and Wells Fargo merger.

Following the merger, Steel was invited to join the board of Wells Fargo and served on the firm's credit and finance committees.  In 2010, upon being appointed Deputy Mayor for Economic Development of New York City, Steel resigned his seat on the Wells Fargo board.

On June 22, 2010, Steel was appointed by New York City Mayor Michael Bloomberg to serve as Deputy Mayor for Economic Development.

Bloomberg News failed/declined to report massive available credit lines for tens of other firms including Wachovia and Wells Fargo, after Robert Steel went to work for Michael Bloomberg.

After paying Peter Weinberg's Perella Weinberg Partners $25 million and Weinberg and Steels' former employer Goldman Sachs $25 million to advise Wachovia on the merger with Wells Fargo, Steel became CEO of Perella Weinberg Partners in 2014.

Both Wachovia and Wells Fargo borrowed from the Federal Reserve's Term Auction Facility (TAF), whose loans were not disclosed to the public until December 1, 2010, subsequent to congressionally mandated legislation and civil legal action.

I believe Wachovia, Wells Fargo, KPMG, the Securities and Exchange Commission (SEC), The Financial Industry Regulatory Authority (FINRA) and the Federal Reserve amongst others illegally misled Wachovia’s shareholders.  I believe I disseminated inaccurate advice to clients who accounts are governed by the Investment Advisors Act of 1940, based on information audited by KPMG and withheld by Wachovia and Wells Fargo’s executive management.  I believe my clients and Wachovia shareholders lost as insiders profited from material undisclosed information.

I executed trades unaware of the Federal Reserve’s secret loans and the Treasury’s largess, as the companies I worked for as well as many others did not disclose material information in their securities filings, even though insiders profited from equity and stock option transactions.

Not reporting Federal Reserve material borrowings, credit lines, terms and interest rates is a violation of Sarbanes/Oxley laws, and not informing employees who managed advisory accounts was a violation of fiduciary duties described in the Investment Advisers Act of 1940.

KPMG was/is the auditor for both Wachovia and Wells Fargo.

I believe Wachovia’s shareholders were misled by Wachovia and Wells Fargo’s management, KPMG, and at least the Federal Reserve and the U.S. Treasury Department.  The Sarbanes-Oxley Act of 2002, which I have taught in ethics courses for CPAs and others requires executive officers and directors to personally attest that SEC securities filings have been personally reviewed and financial statements fairly present, in all material respects, a company’s financial condition.  Financial information in press releases or other public disclosures must not “contain an untrue statement” or omit a statement of  material fact necessary to make statements not misleading.

I filed with the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) DC Office of the Whistleblower amongst others which went nowhere.  I then filed with the NC Secretary of State Securities Division, who investigated and referred files to Atlanta's SEC and FINRA offices.

And then nothing.

American regulatory authorities will not say whether a case exists or if a case is opened or closed, even though I contacted the government during and after interactions with Wells Fargo management, leaving myself and loved ones at risk of reprisal.

I believe Wachovia and Wells Fargo’s executive management misled taxpayers, shareholders and Congress concerning material information.  In doing so, executives violated fiduciary duties to the firms financial advisers and their clients while gaming executive compensation at the expense of Wachovia shareholders.

Government/regulator approved insider trading and securities fraud involving Federal Reserve loans no one knew about except for a select few including some at the top who profited.

I have made everything public as the powers that be have little interest in addressing the issue, which would implicate most of the boards and executives at the largest financial institutions, their auditors and our captured regulatory infrastructure.