CRIMINAL CAPITALI$M; #BANKSTERS
Sen. Elizabeth Warren grilled Jamie Dimon over Chase charging nearly $1.5 billion in overdraft fees during the pandemicdreuter@insider.com (Dominick Reuter)
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The four major Wall Street banks collected a combined $4 billion in overdraft fees during the pandemic.
Sen. Warren said Chase was "the star of the overdraft show," charging customers nearly $1.5 billion.
Warren asked the four banks' CEOs if they would refund the fees. All said no.
Senator Elizabeth Warren singled out JPMorgan CEO Jamie Dimon during a banking committee hearing, grilling him over Chase's decision to continue collecting nearly $1.5 billion in overdraft charges from customers during the pandemic.
Joining Dimon were the CEOs of Citibank, Bank of America, and Wells Fargo, which took in a combined $4 billion in fees from checking customers who had no money in their accounts during the pandemic, against the recommendations of bank regulators.
At the start of the pandemic, Warren explained, the bank regulators told financial institutions that they would not be charged a fee if their accounts at the Federal Reserve were overdrawn. The regulators also recommended the banks extend the same automatic protection to their customers.
Senator Elizabeth Warren asked the CEOs to raise their hands if they had followed that guidance.
-Elizabeth Warren (@SenWarren) May 26, 2021
"I'm not seeing anyone raise a hand, and that's because none of you gave the same help to your customers that the bank regulators extended to you - help that the regulators recommended that you give," Warren said.
Instead, the four leading Wall Street banks, which handle tens of millions of retail checking accounts, charged customers a combined $4 billion in fees during the pandemic when their balances hit zero.
According to the Pew Charitable Trusts, those customers were more likely to be African American or Hispanic, or be earning less than $50,000 per year. Figures from the Consumer Financial Protection Bureau show that just 8% of account holders are responsible for three-quarters of overdraft fees.
Singling out Jamie Dimon of JPMorgan, whom she called "the star of the overdraft show," Warren asked if waiving the nearly $1.5 billion it collected in overdraft fees would have put the bank into financial trouble.
"We waived the fees every time a customer asked because of Covid," Dimon replied.
"Your profits would have been $27.6 billion," Warren said. "I did the math for you."
"Mr. Dimon, will you commit right now to refund the $1.5 billion you took from consumers during the pandemic?" she continued.
"No," he said.
The other three executives also declined Warren's request.
"Last year, when customers said they were struggling, we waived fees on over 1 million deposit accounts, including overdraft fees - no questions asked," Chase spokesperson Amy Bonitatibus said in a statement to Insider.
A previous study found Chase charges more than average for overdraft fees, generating more than $35 per account, compared with Citi, which charges less than $5 per account, according to Aaron Klein, a senior fellow at the Brookings Institution.
"Overdraft is an expensive fee they charge only on those people who run out of money that goes straight to short-term profits," Klein told the New York Times in April.
Wall Street bank CEOs grilled by Senate on PPP, diversity efforts, climate policies
Wall Street was in the hot seat Wednesday when the CEOs of Wells Fargo, Goldman Sachs, Citigroup, JPMorgan Chase, Bank of America and Morgan Stanley testified in a virtual meeting of the Senate Banking Committee. Led by Chairman Sen. Sherrod Brown, D-Ohio, lawmakers fired off questions about diversity, worker organizing and shareholder activism in addition to more finance-specific topics like share buybacks, business lending, inflation and the economic recovery.
Wall Street was in the hot seat Wednesday when the CEOs of Wells Fargo, Goldman Sachs, Citigroup, JPMorgan Chase, Bank of America and Morgan Stanley testified in a virtual meeting of the Senate Banking Committee. Led by Chairman Sen. Sherrod Brown, D-Ohio, lawmakers fired off questions about diversity, worker organizing and shareholder activism in addition to more finance-specific topics like share buybacks, business lending, inflation and the economic recovery.
© Provided by NBC News
While bank executives are used to being grilled by Congressional Democrats, many of the more pointed questions on Wednesday came from Republicans like Banking Committee ranking member Sen. Pat Toomey, R-Pa., who decried what he characterized as banks’ bending to “wokeism” and left-wing “attacks on capitalism” in his opening statement. In a reference to banks’ speaking out on restrictive state voting legislation, Toomey said those kinds of issues should be “left to elected lawmakers.”
Sen. Tim Scott, R-S.C., the Senate’s lone Black Republican, also took aim at what he dubbed “woke capitalism,” which, he said, “seems to be running amok.” He used much of his allotted time pressing the executives to articulate exactly how Georgia’s new voting law — which critics say restricts access to the ballot box, particularly for voters of color — discriminates against Black voters. That bill, when signed into law by Georgia’s governor in March, triggered swift pushback not only from banks but from corporate America more broadly, drawing criticism from CEOs of companies as diverse as Delta Air Lines and Coca-Cola.
In addition to commenting about political motivations in banks’ decision making processes, Sen. Richard Shelby, R-Al., also raised the issue of federal debt and its potential impact on the economy and the banking system. JPMorgan Chase CEO Jamie Dimon responded that the current level of federal debt, at 102 percent of GDP is “not an immediate concern,” although he added, “It will become an issue” in the future.
Dimon repeated his support for a carbon tax, revisiting a theme he had addressed in Chase’s annual shareholder letter earlier this spring. In that letter, Dimon also advocated for what he characterized a national “Marshall Plan” to invest in infrastructure, education and job training. Dimon returned to that theme on Wednesday. “Infrastructure is critical,” he said, even as he warned Senators like Jon Ossoff, D-Ga., that the economic momentum of infrastructure spending could be derailed by excessive regulation.
Sen. Robert Menendez, D-N.J., grilled the executives about expanding access to the financial mainstream, saying big banks have a responsibility to offer low-cost products and services for low-income Americans — and chastised them for not doing more to engage with small businesses, particularly minority-owned businesses, in the aftermath of the pandemic.
Sen. Elizabeth Warren, D-Mass., blasted banks’ fee-collection practices, pointing out that low- and moderate-income bank customers and minorities are disproportionately impacted by overdraft fees, which hit a record high of $33.47 in 2020, according to Bankrate. She asked why banks didn’t automatically suspend overdraft fees for customers during the pandemic even though regulators waived similar Federal Reserve fees banks typically have to pay.
"No matter how you try to spin it, this past year has shown that corporate profits are more important to your bank than offering just a little help to struggling families even when we're in the middle of a worldwide crisis," Warren said, saying claims that the bank helped customers were "a bunch of baloney."
While bank executives are used to being grilled by Congressional Democrats, many of the more pointed questions on Wednesday came from Republicans like Banking Committee ranking member Sen. Pat Toomey, R-Pa., who decried what he characterized as banks’ bending to “wokeism” and left-wing “attacks on capitalism” in his opening statement. In a reference to banks’ speaking out on restrictive state voting legislation, Toomey said those kinds of issues should be “left to elected lawmakers.”
Sen. Tim Scott, R-S.C., the Senate’s lone Black Republican, also took aim at what he dubbed “woke capitalism,” which, he said, “seems to be running amok.” He used much of his allotted time pressing the executives to articulate exactly how Georgia’s new voting law — which critics say restricts access to the ballot box, particularly for voters of color — discriminates against Black voters. That bill, when signed into law by Georgia’s governor in March, triggered swift pushback not only from banks but from corporate America more broadly, drawing criticism from CEOs of companies as diverse as Delta Air Lines and Coca-Cola.
In addition to commenting about political motivations in banks’ decision making processes, Sen. Richard Shelby, R-Al., also raised the issue of federal debt and its potential impact on the economy and the banking system. JPMorgan Chase CEO Jamie Dimon responded that the current level of federal debt, at 102 percent of GDP is “not an immediate concern,” although he added, “It will become an issue” in the future.
Dimon repeated his support for a carbon tax, revisiting a theme he had addressed in Chase’s annual shareholder letter earlier this spring. In that letter, Dimon also advocated for what he characterized a national “Marshall Plan” to invest in infrastructure, education and job training. Dimon returned to that theme on Wednesday. “Infrastructure is critical,” he said, even as he warned Senators like Jon Ossoff, D-Ga., that the economic momentum of infrastructure spending could be derailed by excessive regulation.
Sen. Robert Menendez, D-N.J., grilled the executives about expanding access to the financial mainstream, saying big banks have a responsibility to offer low-cost products and services for low-income Americans — and chastised them for not doing more to engage with small businesses, particularly minority-owned businesses, in the aftermath of the pandemic.
Sen. Elizabeth Warren, D-Mass., blasted banks’ fee-collection practices, pointing out that low- and moderate-income bank customers and minorities are disproportionately impacted by overdraft fees, which hit a record high of $33.47 in 2020, according to Bankrate. She asked why banks didn’t automatically suspend overdraft fees for customers during the pandemic even though regulators waived similar Federal Reserve fees banks typically have to pay.
"No matter how you try to spin it, this past year has shown that corporate profits are more important to your bank than offering just a little help to struggling families even when we're in the middle of a worldwide crisis," Warren said, saying claims that the bank helped customers were "a bunch of baloney."
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