How Walmart Persuades Its Workers Not to Unionize
One former Walmart store manager tells the story that after discovering a pro-union flyer in his store’s men’s room,...
One former Walmart store manager tells the story that after discovering a pro-union flyer in his store’s men’s room, he informed company headquarters and within 24 hours, an anti-union SWAT team flew to his store in a corporate jet. And when the meat department of a Walmart store in Texas became the retailer’s only operation in the United States to unionize, back in 2000, Walmart announced plans two weeks later to use prepackaged meat and eliminate butchers at that store and 179 others.
With 1.3 million U.S. employees—more than the population of Vermont and Wyoming combined—Walmart is by far the nation’s largest private-sector employer. It’s also one of the nation’s most aggressive anti-union companies, with a long history of trying to squelch unionization efforts. “People are scared to vote for a union because they’re scared their store will be closed,” said Barbara Gertz, an overnight Walmart stocker in Denver.
Walmart maintains a steady drumbeat of anti-union information at its more than 4,000 U.S. stores, requiring new hires—there are hundreds of thousands each year—to watch a video that derides organized labor. Indeed, Walmart’s anti-union campaign goes back decades: There was “Labor Relations and You at the Wal-Mart Distribution Center,” a 1991 guide aimed at beating back the Teamsters at its warehouses, and then in 1997 came “A Manager’s Toolbox to Remaining Union Free.” The first half of a statement in that toolbox has been repeatedly snickered at for being so egregiously false: “We are not anti-union; we are pro-associate.”
Early last year, Anonymous, a network of hacker activists, leaked two internal Walmart PowerPoint slideshows. One was a “Labor Relations Training” presentation for store managers that echoed the “Manager’s Toolbox” in suggesting that unions were money-grubbing outfits caring little about workers’ welfare. “Unions are a business, not a club or social organization—they want associates’ money,” the PowerPoint read. (Walmart confirmed the PowerPoints’ authenticity.) “Unions spend members’ dues money on things other than representing them,” it added.
Walmart is perfectly within its rights to communicate its stance to employees. While employers are legally barred from threatening store closures, layoffs, or loss of benefits because of unionization, they are free to tell workers why they oppose unions.
Walmart has battled for years against the United Food and Commercial Workers Union, which represents employees at many grocery stores and retailers, and its offshoot, OUR Walmart, an association of Walmart employees. Walmart insists that the UFCW is out to damage Walmart’s business. The second PowerPoint that Anonymous leaked last year attacked OUR Walmart, asking, “Is OUR Walmart/UFCW here to help you? Answer: NO.”
Tensions have risen between the retailer and OUR Walmart in recent years, with the labor group organizing nationwide protests outside hundreds of stores each Black Friday. The National Labor Relations Board issued a complaint in January of last year, accusing Walmart of illegally firing 19 OUR Walmart members and illegally disciplining more than 40 others after strikes and protests demanding higher pay. Walmart maintains that the firings and disciplining were legal and not in retaliation for protesting.
Getting a glimpse of Walmart’s internal PowerPoints and training manuals is rare, but one of Walmart’s orientation videos was leaked recently, and it again revealed Walmart’s anti-union efforts. Labor experts and Walmart employees say they were surprised at the blatant untruths in many of the video’s pro-company and anti-union statements.
Walmart confirmed the video’s authenticity and said the company showed it to new hires from 2009 through last year. Early on in the course of the video’s nine minutes, an actor dressed as a Walmart employee says, “You’re just beginning your career with us. It’s hard to grasp everything that’s available to you, like great benefits.”
Ken Jacobs, the chairman of the University of California, Berkeley’s Labor Center, suggested that this was essentially propaganda. “Walmart's benefits are well below the standard for union groceries,” he said. “They are not ‘great benefits’ by any standard.” A discounter like Walmart certainly doesn’t have the generous pensions or Cadillac health plans offered by some companies. Gertz, the overnight stocker in Denver, says her health plan is so stingy that she often doesn’t see a doctor when she’s sick because the deductible requires her to pay the first few thousand dollars out of pocket. Gertz said that when workers call in sick, their first day off comes out of their vacation days or personal days, not their paid sick days.
A spokesperson for Walmart says it will soon revamp its policy so that employees can use paid sick days starting on their first day out. The spokesperson added that its bonuses, 401(k) plan, and health plan are considerably better than at most other discounters—its 401(k) plan gives a dollar-for-dollar match for the first six percent of pay and the premium for its most popular health plan is just $21.90 every two weeks. That said, part-time workers, who represent nearly half its work force, don’t qualify for many of these benefits.
The leaked video also boasts, “There’s no retail company that offers more advancement and job security than Walmart.” Considering that some retailers are unionized with strong job-security provisions in their union contracts, some labor advocates wondered how Walmart could begin to assert that its job security is as strong as any other retailer’s.
“That’s patently false,” said Stuart Appelbaum, the president of the Retail, Wholesale and Department Store Union, a division of the UFCW. “At Walmart you can be fired for any reason at all or no reason.” He contrasted Walmart, one of the nation’s many “at-will” employers, with retailers that are unionized or partly unionized, including Costco, Macy’s, H&M and Modell’s. At unionized stores, workers can only be fired “for cause,” meaning managers need a strong reason to fire someone—for example, stealing from a store or arriving 30 minutes late five days in a row. Moreover, workers in those unionized stores can usually challenge their dismissal by bringing in an impartial arbitrator who helps determine whether a firing was justified.
Walmart, in its orientation video, makes other attempts at belittling unions. It features an actor who says, “I was a union member at my last job. Everyone actually had to join the union . . . The thing I remember most about the union is that they took dues money out of my paycheck before I ever saw it, just like taxes.” The character’s assertion that he “had to join the union” diverges from the truth. The Supreme Court ruled in 1963 that workers cannot be required to join the union at a unionized workplace—although they can be required to pay union dues or fees (unless they live in one of the 25 states with “right to work” laws).
In the video, an actress standing in front of a rack of produce continues to hammer the message. “I always thought that unions were kind of like clubs or charities that were out to help workers,” she says. “Well, I found out that wasn’t exactly the case. The truth is unions are businesses, multimillion-dollar businesses that make their money by convincing people like you and me to give them a part of our paychecks.”
Although some union leaders have generous salaries, Benjamin Sachs, a labor law professor at Harvard, said that unions aren’t for-profit businesses. “If unions are businesses, they’re the best example of the sharing economy we’ve seen,” Sachs said. “Here’s the business model: By sharing their resources, including their financial resources, workers make better lives for themselves and their families.” Thomas Kochan, an MIT professor of management, said that the phrase the actor uses—“clubs and charities”—“insults any new hire’s intelligence.” “Most people know what unions are and what they try to do,” Kochan said.
Indeed, one might ask, if unions are doing as little for workers as Walmart maintains, why then does Walmart bother to battle unions so aggressively? Walmart takes a far more jaundiced view of unions than do many Americans—for instance the nation’s Roman Catholic bishops. “The Church fully supports the right of workers to form unions or other associations to secure their rights to fair wages and working conditions,” the bishops once wrote in a pastoral letter, Economic Justice for All. And Pope John Paul II, never known as a raging liberal, called unions, “an indispensable element of social life.”
Brian Nick, a Walmart spokesman, explained why the company made the video. “The core reason to have the training and information on video, in and of itself, is we know that third-party groups often reach out to our associates,” he said. “This is an opportunity for us to provide accurate information that gives our associates knowledge about their work environment and their own rights as associates.”
In boasting about Walmart, the video says, “Walmart jobs are flexible jobs, giving associates the opportunity to balance our personal life with our worklife.” But Carrie Gleason, director of the Fair Workweek Initiative at the Center for Popular Democracy, an advocacy group, strongly disagreed. “I’ve spoken with countless Walmart associates who talk about how erratic their work schedules are, about how managers regularly disregard their requests for basic accommodations so they can go to school or take care of their families,” she said. Some Walmart workers say their stores slashed their hours when they asked managers to accommodate their college schedule or their efforts to hold a second job to make ends meet.
Brian Nick, the Walmart spokesman, said the company was improving its scheduling practices. Beginning next year, it will offer some employees fixed schedules each week—many employees complain that their work schedules change vastly week-to-week.
In urging workers to shun unions, the Walmart video says, “In recent years, union organizers have spent a lot of time, effort and money trying to convince Walmart associates to join a union, all without any success.” But that’s not quite true. The UFCW hasn’t sought to persuade Walmart employees to join a union in recent years, although it did help form OUR Walmart to push for better wages and working conditions. OUR Walmart claimed a victory in February when Walmart announced it would raise its base pay to $9 this year and $10 next year. A spokesperson for Walmart said it was responding to a tighter labor market and boasted that the move would mean raises for 500,000 workers.
The Walmart video is correct about at least one thing: Most of the recent unionization votes at Walmart stores in the U.S. were unsuccessful. For example, the tire and lube workers at two Walmart stores, in Colorado and Pennsylvania, voted overwhelmingly in 2005 against unionizing. But the UFCW had a big success in 2004, when it unionized a Walmart in Jonquiere, Quebec—a first in North America. Walmart closed that store shortly afterward, and Canada’s Supreme Court ultimately ruled that the shutdown was an illegal ploy to avoid having a union. Walmart has long argued that it closed the Jonquiere store because it was unprofitable and that the closing had nothing to do with the union. As for Walmart’s decision to suddenly begin using prepackaged meat after that meat department in Texas unionized in 2000, the company said that the timing was just a coincidence and that the decision had nothing to do with unionization.
This past April, Walmart abruptly announced it was closing its store in Pico Rivera, California, along with four other stores, for six months. Many workers saw that as a daunting anti-union statement—the Pico Rivera store has the nation’s most militant OUR Walmart chapter, having staged a sit-in and numerous other protests. Walmart, however, insisted that the closing was necessitated by “ongoing plumbing issues.”
Source: The Atlantic
Activists at Jackson Hole See Recovery on Wall Street, ‘Not My Street’
The Wall Street Journal - August 22, 2014, by Pedro Nicolaci Da Costa - A group of activists has descended on the...
The Wall Street Journal - August 22, 2014, by Pedro Nicolaci Da Costa - A group of activists has descended on the Kansas City Federal Reserve Bank’s annual conference in Jackson Hole, Wyo., to tell central bank officials that any move to raise interest rates soon could wreak havoc on the lives of Americans still struggling with a weak economic recovery.
U.S. unemployment has fallen fairly rapidly in recent months, to 6.2% in July, down from its post-recession peak of 10%. However, the activists said those numbers mask much deeper troubles in the country’s poorer neighborhoods. The unemployment rate for African-Americans, for instance, was 11.1% in July.
Reggie Rounds, 57 years old, came to the conference from Ferguson, Mo., the site of recent violent protests following the killing of an unarmed teenager by a police officer. During a brief conversation here with Federal Reserve Vice Chairman Stanley Fischer, Mr. Rounds, who is unemployed and says he hasn’t had regular work for years, urged the central bank to keep poor Americans on their minds as they make policy decisions.
“I deal with people who have educated themselves. These people, sir, are inundated with student loans. They’re making just not livable wages or not wages at all,” Mr. Rounds told Mr. Fischer. “We’re desperately needing a stimulant into this economy, and job creation, to get us going.”
Mr. Fischer responded: “That’s what the Fed has been trying to do and will continue to try to do.”
The Fed has kept interest rates near zero since December 2008 and bought more than $3 trillion in government and mortgage bonds to keep long-term rates low, spur investment and boost hiring.
However, recent improvements in the job market and a pickup in inflation have revived debate about when the central bank should begin lifting interest rates from rock-bottom lows. In her speech here Friday, Fed Chairwoman Janet Yellen said if the labor market keeps improving faster than the Fed forecasts the central bank could raise rates sooner than expected. Many investors anticipate the first move in the summer of next year, a perception some top Fed officials have encouraged.
Representatives of the Center for Popular Democracy, a left-leaning national nonprofit organization, said they organized the activists’ trip to Jackson Hole. The participants argued that near-term rate increases could have a deep negative impact on the most vulnerable sectors of the population.
Reuben Eckels, 51, a reverend from Wichita, Kan., said he had come to the conference to tell policy makers “how raising interest rates would affect the community in which I serve.” He and other activists played down the notion of a “skills gap” where workers might not have the qualifications for the jobs available.
“We have young people who are college students in our church who have a 4.0 [grade average], Dean’s list, they can’t find jobs,” he said. “So this is not about just raising the rates so we can offset an imbalance for those elderly who are trying to save their portfolio. This is about people on the street, everyday people … who are just trying to live a good quality of life.”
Shemethia Butler, 34, is one such individual. Hailing from Washington, D.C. the mother of two says she is dealing with extreme stress because the wages she earns at McDonald’s aren’t enough to cover her rent, much less basic expenses like food, electricity and transportation.
“I have no vehicle. My housing situation is stressful. I’m about to lose my apartment. I’m struggling really hard,” she said. “Things may be fine on Wall Street, but they’re not fine on my street.”
Source
111 Miles in Ten Days: Marchers Take Nonviolent Message From Charlottesville to D.C.
111 Miles in Ten Days: Marchers Take Nonviolent Message From Charlottesville to D.C.
About a hundred people are walking north from downtown Charlottesville, Virginia, the scene of a white supremacist...
About a hundred people are walking north from downtown Charlottesville, Virginia, the scene of a white supremacist rally and riot this month, to Washington, D.C., 111 miles away. The journey—a nonviolent response to the violence of the hate groups that descended on Charlottesville—is expected to take ten days.
They are led by the Reverend Cornell William Brooks, a civil rights lawyer and former president and CEO of the NAACP.
Read the full article here.
New Video: Preying on Puerto Rico, The Forgotten Citizens of Hedge Fund Island
New Video: Preying on Puerto Rico, The Forgotten Citizens of Hedge Fund Island
Last month I returned to my native Puerto Rico to attend a wedding and was catching up with family still on the Island...
Last month I returned to my native Puerto Rico to attend a wedding and was catching up with family still on the Island one evening. A couple of sips of whiskey in, and the truth came out: My wife’s father reported that he hadn’t received a paycheck in 3 months.
He is a doctor. A highly specialized one, And, with most of his patients coming through government insurance, he hadn’t seen a dime in payment.
Most Puerto Rican health care professionals try to hang on as long as possible. They want to stay in their homeland, be with their families and help make things better. But increasingly, they have no choice. Now many doctors are among the hundreds of thousands of Puerto Ricans who have become economic migrants, forced to flee from home because they simply cannot survive on patriotism and hope.
In 2014, 364 doctors left the island, the Puerto Rican Surgeons and Physicians Association reported. Last year, 500 practitioners packed up and got out.
“Don’t get hurt on a Sunday or a holiday,” one man recently told CNN after his uncle died because only 2 neurologists were on duty to serve the island’s 3.5 million “forgotten citizens.” (His family now calls the lines at the hospital “the walking dead.”)
Behind those staggering numbers is rapacious, hungry, heartless greed as embodied by two simple words: Hedge funds.
Just like Detroit, Greece and other places rocked by the recession and government mismanagement, Puerto Rico’s debt ballooned over the last decade, further exacerbated by colonial status and expiring tax incentives.
In 2012, hedge fund managers began to circle the Commonwealth, looking to reap billions – and experiment with new wealth extraction strategies that could be imported back to the American mainland. The short version: They bought Puerto Rican bonds after the price fell.
Now these “vulture” managers (as they are literally called for their creditor and distressed buying schemes – los buitres in Spanish) insist that any package from Washington that allows Puerto Rico to renegotiate its $72 billion debt puts Wall Street investors at the front of the line to get paid.
A handful are holding out for even more; refusing to accept any restructuring and demanding even more severe austerity measures and suffering so they don’t have to take any losses on their risky investment.
These carrion feeders are in fact, real human beings, acting in inhumane ways: Mark Brodsky, of the $4.5 billion Aurelius Capital and Andrew Feldstein, of the $20 billion BlueMountain Capital are two leaders of the vulture flock of hedge fund billionaires circling Puerto Rico trying to make huge profits from what’s turning into a full-scale humanitarian crisis.
Brodsky bought up the Island’s debt for as low as 29 cents on the dollar and now is demanding full repayment (Think Greece, and Argentina). He is helping fund economists who argue that vital government services must cease – and schools and hospitals must close - to extract full payment.
Feldstein has teams of lawyers fighting basic protections for Puerto Ricans in court and lobbyists taking the same case to Congress. On his dime they have launched a high profile and highly fraudulent media campaign to make sure Congress keeps working for the billionaires – and against teachers, students, the elderly… and my former neighbors and relatives.
Together with John Paulson – who literally bragged to his bros that together they could create the “Singapore of the Caribbean” and create a tax haven for themselves – these vulture investors are consuming the living, for their greed.
That’s why I’ve been working with Brave New Films and a large coalition, including Make the Road, New York Communities for Change, Organize NOW, Florida Institute for Reform & Empowerment, AFT, SEIU, NEA, New Jersey Communities United, Grassroots Collaborative , Center for Popular Democracy, Strong Economy for All, and Citizen Action, under the campaign banner Hedge Clippers, to help ordinary Puerto Ricans expose the truth about these bad actors and their flock.
Preying on Puerto Rico: Forgotten Citizens of Hedge Fund Island is a series of short film videos that Puerto Rican activists helped create to kick off an escalated series of large actions calling on those with the power to help to stand up for Puerto Ricans and stand up to los buitres.
These same leaders are behind a growing wave of protests on Capitol Hill, Wall Street, the Trump Towers and at the Federal Reserve Board offices in cities across the U.S.
They are getting attention and being heard, but the path forward is uphill. We need your help. With unemployment at 14% and 45 percent of Puerto Ricans living below the poverty line Puerto Rico is in a humanitarian crisis. PROMESA, the bill that just passed out of the US House and is on its way to the Senate, is a bad deal that will help the hedge funds, but not the Puerto Rican people.
Preying on Puerto Rico: Forgotten Citizens of HedgeFund Island is only the beginning of how we can use our voices and votes to help my father in-law remain on the Island to help save lives – and end this suffering caused by these vultures and the politicians that do their bidding.
Join us today to share these films – and call Feldstein and Brodsky to ask them: how many more billions do you need to make before you stop pillaging the poor?
By Julio López Varona / Brave New Films
Source
Demonstrators bring Dreamers, TPS cause to Trump’s doorstep
Demonstrators bring Dreamers, TPS cause to Trump’s doorstep
Several dozen demonstrators, organized by progressive groups and chanting in Spanish, brought the cause of the Dreamers...
Several dozen demonstrators, organized by progressive groups and chanting in Spanish, brought the cause of the Dreamers and Temporary Protected Status refugees—both groups targeted for eviction from the U.S. by Donald Trump—to the doorstep of the GOP president and his Republican backers on the evening of Feb. 1.
Read the full article here.
Blacks Nearly Four Times More Likely Than Whites to Be Unemployed in Minnesota
Minneapolis City Pages - March 6, 2015, by Ben Johnson - A new study reaffirms a refrain equality advocates have become...
Minneapolis City Pages - March 6, 2015, by Ben Johnson - A new study reaffirms a refrain equality advocates have become quite fond of in this state: Minnesota is a great place to live -- for white people.
The Center for Popular Democracy and the Economic Policy Institute released a study yesterday showing the statewide unemployment rate for black people is 11.7 percent, compared to 3.2 percent for white people.
Black Minnesotans' unemployment rate is 3.7 times higher than white Minnesotans'. The study analyzed all 50 states and the District of Columbia, and the only places with a larger gap were Wisconsin (4.6 times higher) and D.C. (5.6 times higher).
Minneapolis unemployment rates are lower than statewide, but the racial gap (3.9x) is even higher.
When these figures came out yesterday protesters from across the country lobbied the Federal Reserve to keep its interest rates low.
When interest rates are low it's easier for businesses to borrow money, and in theory, easier access to money means businesses can hire -- and pay -- more people. On the flip side, if interest rates are kept too low for too long inflation becomes a concern.
"Unemployment is slowly, slowly heading in the right direction, but raising interest rates at this point would really set minorities back," said Becky Dernbach with Neighborhoods Organizing for Change, which held a rally yesterday at its headquarters. "We think the Fed needs to pay special consideration to how the recovery has not hit certain communities at all."
NOC and its allies are supportive of Minneapolis Fed President Narayana Kocherlakota, who favors keeping interest rates low, but he's stepping down in a year. Protesters made it clear yesterday they want a say in who takes his place.
"On a fundamental level, we need to have a voice in the process," said Dernbach.
Source
States Expand Inquiry Into On-Call Scheduling
Eight states and the District of Columbia have expanded their probe into on-call scheduling at retail companies,...
Eight states and the District of Columbia have expanded their probe into on-call scheduling at retail companies, asking a group of national chains to provide detailed information on their use of the controversial practice.
On-call shifts, where a worker must be available to work a shift that can be cancelled at the last minute without compensation, has become popular in retail. But the practice wreaks havoc on the lives of low-paid hourly workers trying to plan plan around child care, schooling, or second jobs, as a BuzzFeed News investigation found last year.
At the time, New York Attorney General Eric Schneiderman sent a letter to 14 chains (published below), inquiring about their use of on-call scheduling and warning it may be illegal. Since then, Victoria’s Secret, Bath & Body Workers, J. Crew, Urban Outfitters, and Gap have committed to ending the practice.
“On-call shifts are not a business necessity, as we see from the many retailers that no longer use this unjust method of scheduling work hours,” said Schneiderman in a statement.
A study by the left-leaning Economic Policy Institute found that the lowest income workers receive the most irregular schedules, with unpredictability leading to increased stress.
“It’s heartening to see more and more policymakers and regulators take action,” said Carrie Gleason, Director of the Fair Workweek Initiative at the Center for Popular Democracy, a liberal advocacy group.
On Tuesday, the offices of the Attorneys General in California, Connecticut, the District of Columbia, Illinois, Maryland, Massachusetts, Minnesota, New York, and Rhode Island sent a letter requesting employee handbooks, schedules, and payroll information.
In these states, the Attorneys General warn, the practice may be a violation of a law mandating a minimum of four hours of pay for employees who report for work.
The following retailers received the letter: Aéropostale, American Eagle, BCBG Max Azria, Carter’s Inc., Coach, DavidsTea Inc., Walt Disney Co., Forever 21 Inc., Ascena Retail Group Inc.’s Justice, Pacific Sunwear of California Inc., Payless ShoeSource, Tilly’s Inc., Uniqlo, VF Corp.’s Vans, and Zumiez Inc.
Spokespeople from Uniqlo and Coach told the Wall Street Journal that the companies don’t use the practice. BuzzFeed News has reached out to the companies listed for comment and will update the post with responses.
UPDATE
A spokesperson for American Eagle Outfitters said in a statement, ““American Eagle Outfitters is committed to providing our associates with a positive working environment. We decided in November 2015 to cease the use of ‘on-call shifts’ and advised our stores. We are taking steps to reinforce and assure adherence to this policy across our store fleet.”
A spokesperson for Forever 21 said, “Contrary to published reports, Forever 21 does not permit on-call scheduling nor do we have a company policy around doing so.”
A spokesperson for Vans said the company does not use on-call scheduling and will comply with the request for information.
A spokesperson for Uniqlo said that Uniqlo has received the letter and that on-call scheduling is not a Uniqlo practice or policy.
A spokesperson for Payless ShoeSource says the company does not engage in on-call scheduling, has received the inquiry and will respond accordingly.
A spokesperson for Zumiez said, “It is our practice to cooperate with any request from the attorney general or other state agencies and we will do so in this case as well.” Apr. 14, 2016, at 10:21 a.m.
By Cora Lewis
Source
Pressures mount on Wells Fargo following fake-accounts scandal
Pressures mount on Wells Fargo following fake-accounts scandal
Pressure mounted on Wells Fargo & Co. Friday following its fake-accounts scandal, as the bank faced new calls to...
Pressure mounted on Wells Fargo & Co. Friday following its fake-accounts scandal, as the bank faced new calls to allow affected customers to file lawsuits and for the board of directors to rescind the pay of a key senior executive.
The demands came just one day after Chief Executive John Stumpf resigned from a Federal Reserve advisory panel.
Senators had pushed for Stumpf not to be reappointed, saying it was inappropriate for someone who presided over improper sales tactics to be giving advice to an agency involved with bank regulation.
Stumpf has been under intense fire since the bank this month agreed to pay $185 million to settle investigations by Los Angeles City Atty. Mike Feuer, the Consumer Financial Protection Bureau and the Office of the Comptroller of the Currency into an aggressive sales culture that led bank employees to open as many as 2 million accounts that customers didn’t authorize.
The Justice Department is investigating possible criminal charges, and some senators have called for a Labor Department investigation into whether the bank failed to pay employees overtime when they worked late nights and weekend to meet sales quotas.
A group of Senate Democrats continued to attack Wells Fargo on Friday, publicly calling on Stumpf to stop enforcing mandatory arbitration clauses in the agreements for customer accounts that were not authorized.
Sen. Sherrod Brown (D-Ohio) had pressed Stumpf on the matter at a Senate Banking, Housing and Urban Affairs Committee hearing Tuesday, arguing that it was unfair not to allow those customers the ability to file lawsuits against the bank.
Stumpf said at the time that he would have to “talk to my legal team.”
Brown said Friday that he and his colleagues want relief for bank customers and more answers from Wells Fargo.
“If Wells Fargo really does want to look out for the customers, if they really are in fact sorry, as the CEO said, for these unauthorized accounts, they ought to let the court system work if these people who were wronged want to bring suit,” he said.
Wells Fargo's collateral damage: customers' credit scores
Wells Fargo's collateral damage: customers' credit scores
The Democrats sent a letter to Stumpf on Friday, requesting more information about the arbitration clauses, including how many customer complaints about fake accounts were forced into arbitration proceedings.
Brown was among those writing to Stumpf, along with Patrick Leahy of Vermont, Richard Durbin of Illinois, Richard Blumenthal of Connecticut, Al Franken of Minnesota and Elizabeth Warren of Massachusetts.
A spokeswoman for Wells Fargo did not immediately respond to a request for comment.
Also on Friday, an activist investment group that is part of the Change to Win union federation wrote to Wells Fargo’s board, asking it to rescind at least part of the compensation earned by the executive who oversaw the employees who opened unauthorized customer accounts.
The letter from CtW Investment Group, which is a Wells Fargo shareholder, adds to the pressure on the bank to claw back some of the approximately $100 million earned by Carrie Tolstedt, the company’s former head of community banking.
Wells Fargo’s stock has declined by about 8% since the settlement was announced on Sept. 8.
On Thursday, five senators called for Stumpf not to be reappointed to the Federal Advisory Council, a 12-member body that meets four times a year with the Fed’s Board of Governors to discuss banking and economic matters.
Stumpf had represented the Fed’s San Francisco district, where Wells Fargo is based, since 2015.
He “made a personal decision to resign” and notified the Fed on Thursday, Wells Fargo spokeswoman Jennifer Dunn said.
“His top priority is leading Wells Fargo,” she said.
Sen. Angus King, an independent from Maine, organized the letter to the head of the board of directors of the Federal Reserve Bank of San Francisco asking that Stump not be reappointed to the advisory council when his term expires on Dec. 31.
“It would be ironic if the Federal Reserve, a key federal banking regulator tasked in part with ensuring the fair and equitable treatment of consumers in financial transactions, continued to receive special insights and recommendations from senior management of a financial institution that just paid a record-breaking fine to the Consumer Financial Protection Bureau for ‘unfair’ and ‘abusive’ practices that placed consumers at financial risk,” they wrote.
The letter also was signed by Warren and Democratic Sens. Maria Cantwell of Washington and Jeff Merkley and Ron Wyden, both of Oregon.
Their call was backed by Fed Up, a coalition of labor, community and liberal activist groups that has pushed to reduce the influence of bankers on Federal Reserve policies.
“Commercial banks already have too much influence within the Federal Reserve System,” the coalition said Thursday. The coalition also asked its members to sign a petition calling for Stump’s “immediate dismissal” from the advisory panel.
“Stumpf, as the CEO of a bank accused of ‘unfair’ and ‘abusive’ practices, should have no role advising the Federal Reserve’s Board of Governors on policies affecting working families,” Fed Up said.
By Jim Puzzanghera
Source
New Report Cites $100 Million-plus in Waste, Fraud in Charter School Industry
A new report by two groups that oppose reforms that are privatizing public education finds fraud and waste totaling...
A new report by two groups that oppose reforms that are privatizing public education finds fraud and waste totaling more than $100 million of taxpayer funds in 15 of the 42 states that operate charter schools.
The report, titled “Charter School Vulnerabilities to Waste, Fraud, & Abuse,” and released by the nonprofit organizationsIntegrity in Education and the Center for Popular Democracy, cites news reports and criminal complaints from around the country that detail how some charter school operators have illegally used public money. It also makes policy recommendations, including a call for stopping charter expansion until oversight of charter operators is improved. Released during National Charter School Week, it notes that despite rapid growth in the charter industry, there is no agency at the federal or state level that has the resources to provide sufficient oversight.
The Obama administration has supported the spread of charter schools but has also called for better oversight. Proponents of charter schools say they provide choices for parents and competition for traditional public schools, but critics note that most don’t perform any better — and some of them worse — than traditional public schools and take resources away from school districts. Some critics see the expansion of charter schools as part of an effort by some school reformers to privatize public education.
The report details cases from state after state, among them:
*In Washington D.C.:
In the fall of 2008, the U.S. attorney’s office issued a subpoena for school financial records related to L. Lawrence Riccio’s “alleged criminal activities” at the School for Arts in Learning (SAIL). Known internationally for his work in the education of youth with disabilities, Riccio founded the Washington, DC charter school in 1998, but by 2007, a memo by a financial consultant to SAIL’s former chief financial officer describes complete disarray of financial matters. Though grant money had been flowing in, staff members were not allowed to purchase supplies, rent went unpaid, and funds from one Riccio-led organization paid expenses for another. Financial statements showed that SAIL and sister organizations paid a $4,854 credit card bill to cover Mr. Riccio’s travel -related expenses in Scotland, as well as membership dues and dinner tabs at the University Club, a premier private club. SAIL covered expenses for travel to Boston, Denver, Houston and New Orleans; grocery stores, drugstores, wine and liquor stores and flower shops, cafes and restaurants, a salon and spa, Victoria’s Secret and at a glass, paint and wallpaper shop in France, where Mr. Riccio and his wife maintain a private residence.
and
Former leaders of Options Public Charter School are under Federal investigation for possible Medicaid fraud and other abuses. They are accused of exaggerating the needs of the disabled students, bilking the federal government for Medicaid funds to support their care, and creating a contracting scheme to divert more than $3 million from the schools for their own companies, including a transportation company that billed the Federal government for transporting students to the school, but apparently offered gift cards to students to increase ridership on the buses. Additionally, a senior official at the D.C. Public Charter School Board allegedly received $150,000 to help them evade oversight.
*In Ohio:
Ohio Auditor of State Dave Yost, speaking about nearly $3 million in unsubstantiated expenses amassed by the Weems Charter School, said: “This is a heck of a mess…Closed or not, the leadership of this school must be held responsible, and the money must be returned to the people of Ohio.”
* In Wisconsin:
In 2008, Rosella Tucker, founder and director of the now-closed New Hope Institute of Science and Technology charter school in Milwaukee, was convicted in federal court of embezzling $300,000 in public money and sentenced to two years in prison. Tucker acknowledged taking U.S. Department of Education money intended for the school, which she started through a charter agreement with Milwaukee Public Schools. She spent about $200,000 on personal expenses, including cars, funeral arrangements and home improvement, according to court documents. Tucker has argued that the remainder of the money she received was legitimate reimbursement for school-related expenses. Tucker embezzled the $300,000 from 2003 to 2005. The Milwaukee School Board voted to close New Hope Institute of Science and Technology in February 2006, amid problems that included unpaid bills and lack of appropriate teacher licensure.
* In California:
Steven A. Bolden pleaded guilty on January 2, 2014 to stealing more than $7.2 million worth of computers from a government program. Between 2007 and 2012, Bolden invented more than a dozen education non-profits, including fake charter schools, to benefit from a General Services Administration program that gives surplus computer equipment to public schools and non-profits. In July 2012, a GSA undercover investigator was contacted by Palmdale Educational Development Schools, one of Bolden’s organizations, and sent Bolden 9 laptop computers, which Bolden sold via Craigslist.
Here’s the report:
Charter School Vulnerabilities to Waste, Fraud, & Abuse
Source
Neel Kashkari Named Next Minneapolis Fed President
Neel Kashkari, a former financier who managed the U.S. Treasury’s $700 billion rescue of banks in the 2008 crisis, was...
Neel Kashkari, a former financier who managed the U.S. Treasury’s $700 billion rescue of banks in the 2008 crisis, was named the next president of the Federal Reserve Bank of Minneapolis.
Kashkari’s resume includes stops at Goldman Sachs Group Inc. and Pacific Investment Management Co., and a failed run for governor of California last year. At the Treasury, he was Secretary Henry Paulson’s key aide in overseeing the Troubled Asset Relief Program, or TARP. Kashkari will take over from Narayana Kocherlakota on January 1, 2016, according to a statement Tuesday from the Minneapolis Fed.
“He has a little bit of all the pieces you’d want in a Fed president,” said Stephen Stanley, chief economist at Amherst Pierpont Securities LLC in Stamford, Connecticut.
As head of one of 12 regional Fed banks, Kashkari will join the Federal Open Market Committee, the central bank’s policy making panel. The Fed is weighing ending a seven-year era of near-zero interest rates, with investors betting it will move next month. Kashkari is not scheduled to vote on policy decisions until 2017. Kocherlakota, as is customary for outgoing FOMC members, will not attend the December meeting.
QE ‘Morphine’
Kocherlakota is one of the Fed’s most dovish policy makers who has argued it should keep rates on hold into next year. Kashkari has offered observations on monetary policy via his twitter feed, without spelling out whether he would favor raising rates or delaying liftoff in the current climate. In an April 2013 comment he likened the Bank of Japan’s asset purchase program to “morphine. makes u feel better but doesn’t cure.”
“I don’t think we know that much” about Kashkari’s views on monetary policy, said Angel Ubide, a senior fellow at the Peterson Institute for International Economics in Washington. “My experience with people who get appointed is whatever they thought before and what they do later doesn’t necessarily correlate.”
Kashkari, 42, earned bachelor’s and master’s degrees in mechanical engineering at the University of Illinois at Urbana-Champaign, and an MBA from the University of Pennsylvania’s Wharton School. He began his career as an aerospace engineer at TRW Inc. in Redondo Beach, California.
Goldman Sachs
Kashkari’s appointment places another ex-Goldman Sachs banker at the helm of a regional Fed bank. Robert Steven Kaplan at the Dallas Fed and New York’s William C. Dudley are Goldman alums. Philadelphia Fed chief Patrick Harker previously served as a trustee at Goldman Sachs Trust and as a member of the board of managers of Goldman Sachs Hedge Fund Partners Registered Fund.
“We’re disappointed that yet another former Goldman Sachs insider has been elevated to a regional president position,” said Jordan Haedtler at the Center for Popular Democracy in Washington.
Such appointments need “more transparency and public input,” said Haedtler, who’s deputy campaign manager at Fed Up, a national coalition that’s calling for changes at the central bank and wants to keep rates low to boost employment.
Kashkari worked at Goldman in the early 2000s before accepting a post at the Treasury in 2006. He joined Pimco, then led by bond fund manager Bill Gross, in 2009 to help oversee an expansion into equities, an attempt to reduce the firm’s heavy dependence on the fixed-income market. When he left in 2013, the company’s equity unit had attracted $10 billion in assets, or less than 1 percent of the firm’s total assets at the time.
Bank Bailout
TARP, approved by Congress in October 2008, remains one of the more controversial measures taken during the financial crisis. It authorized the government to purchase up to $700 billion in troubled assets from financial institutions, in an effort to bolster global credit markets. The government ultimately used $475 billion, including $250 billion to stabilize banks, $82 billion to bail out auto makers and $70 billion to save insurer American International Group Inc., according to the Treasury’s website.
“Mr. Kashkari is an influential leader whose combined experience in the public and private sectors makes him the ideal candidate to head the Minneapolis Fed,” said MayKao Hang, incoming chair of the Minneapolis Fed’s board of directors and co-chair of the search committee.
Kashkari, a Republican, was defeated by incumbent California Governor Jerry Brown in November 2014, getting 43 percent of the vote to Brown’s 57 percent.
Presidents of the 12 regional Fed banks are appointed by a portion of their respective boards of directors, subject to the approval of the Fed Board in Washington. Reserve bank boards typically consist of nine members, including three bankers. The banking members are excluded under Dodd-Frank from participating in the selection of presidents.
Source: Bloomberg Business
5 days ago
5 days ago