City Council Vote Could Help Prevent Next Fake Bank Accounts Scandal

Last Wednesday, Los Angeles City Council voted 12-0 in favor of making banks disclose whether they set individual or branch-level sales goals or requirements, if they want to do business with the city, American Banker reported.

“As city leaders, we must expect the highest level of financial and social responsibility from our banking and service providers,” said Council Member Nury Martinez, who sponsored the bill, in a statement. “While the city is not a regulatory agency, our taxpayers deserve to know that their money is being handled the right way, by the right banks.”

The vote instructs the city attorney to draft language to add to the city’s existing responsible banking ordinance that would require banks doing business with the city to disclose whether they set or allow individual or branch-level goals or requirements for the sale of a consumer financial service; whether they consider the quantity of an employee’s sales of consumer financial products and services as a basis for employee advancement, discipline, termination or compensation; and whether the bank has policies, protocols, and trainings in place at both the employee and management level to help prevent the abuse of sales of consumer financial services and products.

“Bank workers like me have had to choose between making high-pressure quotas so we could afford to buy groceries or push unnecessary products onto our customers,” said Mona Bly, who worked at Wells Fargo and is now a member of the Committee for Better Banks, in a statement from that organization. “We can’t stand idle and just wait for another Wells Fargo. Los Angeles is taking an important step towards ensuring our banking industry learns its lesson for good.”

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