Wells Fargo, America’s biggest bank by market capitalization, has apparently been scamming its customers by opening unauthorized deposit and credit card accounts for years. High sales targets and promises of bonuses prompted employees to commit illegal cross-selling–which is when you sell multiple products or services to the same customers. In fact, 5,300 employees have been fired for “inappropriate sales conduct” over the past five years.

On Thursday the Consumer Financial Protection Bureau (CFPB) fined the bank $100 million, which is the highest fine the federal agency has ever issued. Additional fines of $35 million and $50 million each are to be paid to the Office of the Comptroller of the Currency, and to the City and County of Los Angeles.

The director at CFPB, Richard Cordray, said in a press release:

Wells Fargo employees secretly opened unauthorized accounts to hit sales targets and receive bonuses. Because of the severity of these violations, Wells Fargo is paying the largest penalty the CFPB has ever imposed. Today’s action should serve notice to the entire industry that financial incentive programs, if not monitored carefully, carry serious risks that can have serious legal consequences.

Banking analyst Dick Bove said on Friday that it’s time to sell your stocks in the bank. He told CNBC: “What Wells has done is it’s saying that it’s treating customers badly, it broke faith with customers. There is no business in the world that can treat its customers badly and continue to expect to grow.”

To gain back the public’s trust after something big like this, especially with the 2008 financial crisis fresh in mind, Bove said Wells Fargo would need to do something drastic. For example, forgive all student loan debt. He said:

If you do that to customers who have student loans, they’ll stay with you for life. It requires something big, comprehensive and meaningful. Whether it’s that exact action or some other action that they come up with, I don’t know. I think it requires a significant step to re-establish faith with the consumer.

Many Twitter users reacted to the news.

“Hello Wells Fargo, I’d like to open a checking account, savings account and two credit cards.”
“You’re in luck. We’ve already opened them.”

— Fake Dispatch (@Fake_Dispatch) September 9, 2016

And one popular question is why no higher executives have been held accountable.

It’s weird how 5,000 front line Wells Fargo employees hit on similar scams without any wrongdoing by high-level executives.

— Matthew Yglesias (@mattyglesias) September 9, 2016

Essentially, employees at the bank boosted their sales by secretly opening new accounts and then funding them by transferring money from customers’ existing accounts. This often brought along additional fees and charges for the customers. It’s been reported that more than two million deposit or credit accounts were opened in this fashion. According to Reuters, employees were told that most customers used six financial tools but that they should push them into using at least eight.

According to CNN’s Douglas Rushkoff, the scale of these scams show that it’s not just the behavior of one bad banker, but rather a symptom of extreme capitalism in the banking world. Since banks make money from extracting funds from customers who want to invest or make transactions, they need to make sure those processes happen. During a time with slow growth though, the bankers need to create some kind of growth synthetically, out of fear of losing their jobs or missing out on a bonus. An easy way to do this is extract more money from people who already are customers, by offering new credit cards with higher fees or loans with higher costs or new terms that are worse for the customer but better for the bank.

Wells Fargo has been known for its ability to cross-sell multiple products to the same customers. In a statement on the bank’s website it said:

Wells Fargo is committed to putting our customers’ interests first 100 percent of the time, and we regret and take responsibility for any instances where customers may have received a product that they did not request.

Wells Fargo has issued a statement regarding definitive settlement agreements. Read more: https://t.co/tCMOlGkfln. pic.twitter.com/DSEjFC1BpA

— Wells Fargo News (@WellsFargoNews) September 8, 2016

Emma Von Zeipel

Emma Von Zeipel is a staff writer at Law Street Media. She is originally from one of the islands of Stockholm, Sweden. After working for Democratic Voice of Burma in Thailand, she ended up in New York City. She has a BA in journalism from Stockholm University and is passionate about human rights, good books, horses, and European chocolate. Contact Emma at EVonZeipel@LawStreetMedia.com.

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We have all seen them, whether we are sitting in a doctor’s office in the middle of the day, home sick during the week, or just because they’re kind of fun. Either way, court shows like “Judge Judy” and “Judge Joe Brown” seem to have captured the world’s attention. Recently, Judith Sheindlin–Judge Judy–signed on for her eighteenth season of the show, earning herself $47 million a season for what is famously known as just “52 days of work a year.”

Judge Judy, and all of the others–Brown, Lane, Mathis, Hatchett, Alex, Rinder, etc.–are all practicing lawyers. Most were retired or on the way to retirement when they were discovered by a television producer. But that still begs the question: how exactly do TV courts work, what are their legal implications, and are they at all real?

 What are Court TV shows?

Court television shows are usually on in the middle of the day, often right when people are getting home from work and starting to cook dinner. The topics usually aren’t heavy things like murder, drugs, or assault cases. Instead they consider lighter issues like rent problems, car damages, or theft. Judges tend to be funny and lash out with zingers toward the people involved in the case. It is all about entertainment, not a real legal process.

However, the shows are among the highest watched for their time slot, which means that if one judge isn’t connecting with the audience, another one is right in line to take that spot.

Infographic courtesy of Online Paralegal Programs.

 How do you end up on TV court?

Getting onto a court show is actually one of the smartest things a person can do, even if he ends up being portrayed as the “villain” in the narrative. Why? Participants all stand to make money.

In general, most of the cases that end up going on to TV shows are cases that would otherwise be heard in small-claims court. According to FindLaw, there’s only a certain amount of money litigants can receive. For example, individuals who appear on “Judge Judy” would be able to receive a maximum of $5,000. It’s safe to assume that the rest of the shows have relatively similar limits.

According to FindLaw, regardless of the outcomes on any of the shows that play nationally, there are benefits to both parties in the case. The shows actually pay for the arbitration awards, which may be why people don’t always seem to be too worked up at the end in the cool down interviews. They also pay for the litigants’ airfare and hotel expenses.

In other cases, there have been situations where producers have found people who were popular or characters already and they have actually been courted into doing the show. For example, local Cleveland celebrity Colin Dussault was asked to be part of a newer judge show called “Hot Bench.”

A Hollywood producer contacted Dussault after “field researchers” came across his small-claims lawsuit against his sister, which he filed in Lakewood Municipal Court in January. In a nutshell, they’ve got issues with who should pay the ongoing bills for a double they inherited and both live in. (Double Trouble?)

In addition to prompt payment of any settlement, the producer promised, Dussault would get an additional “guaranteed minimum payment” just for being on the show!

 What happens on a TV court show?

Court shows like Judge Judy aren’t actually court cases, but instead they are an arbitration process, which is a way to resolve disputes without actually going to court. An arbitrator, always some sort of neutral party, hears a case and makes a binding decision. It’s less formal than a court case, but it does require training

The shows are all filmed at studios in Los Angeles near many different studios that also happen to film television shows. In fact, “Judge Judy” is filmed right next to “Judge Joe Brown.” In order to ensure a full audience, the producers of all of the shows will hire extras who comprise the entire gallery and who sign waivers to stop the disclosure of any details. However, they also take visitors who are willing to sign similar forms.

What happens after the show?

As a general rule, arbitration awards cannot be appealed. But there have been a few cases in which, according to The New York Times,  TV judge rulings have been overturned through other court systems. This can be because the artbitration didn’t cover everything necessary or if the case was found to be beyond the scope of arbitration.

According to FindLaw:

For example, a New York family court in 1999 overruled part of a “Judge Judy” decision because it went beyond the scope of the arbitration, the New York Law Journal reports. The parties in that case had agreed to arbitrate a dispute over personal property — but Judge Judy’s ruling also granted child custody and visitation rights.

In 2000, Judge Judy had one of her decisions overturned…In the case B.M. v. D.L., the parties appeared in front of Sheindlin to solve a personal property dispute. Sheindlin ruled on that dispute, but also made a decision on the parties’ child custody and visitation rights. One of the parties appealed in court, and the family court overturned the custody and visitation part of the decision because they weren’t covered by the agreement to arbitrate.

Ethical Concerns

For people who have never really been in a court room, it can seem like there aren’t really any ethics that exist when it comes to television court. For one, there are no lawyers even present on the television shows. There are problems, of course, with the editing and the way people are portrayed by the producers of the show.

Recently a committee was formed to discuss the problems with court television shows and the impact they have on the lives of those who appear–often people who are young and trying to avoid paying costs that they can’t afford. The committee, comprised of retired judges, said:

In this modern media culture once the taping is done and it is released into the public domain it is there forever and can come up from time to time during this defendant’s entire life. It could be used against this person in a personal, political, economic or social situation to his or her extreme detriment. Your recitations that the videos in your court are a number one rated show broadcasted to 200,000 households in three counties speak volumes in this regard. How might it appear to a defendant that he or she must be asked by the judge to waive any objection to appear on television? Would they be intimidated by the question knowing that the judge encourages this production?

These cases are often straight forward, but played up for laughs, drama, and a clear-cut decision. There have been many questions about the fates of people who end up on reality shows, and that is a question that exists with the “reality” of court shows as well.

Conclusion

So yes, the decisions on TV court shows are a reality–someone has to pay (usually the show) and someone is in trouble (usually younger-skewing teens or adults who can’t afford much else). You’re getting, in essence, a half-truth of what the court process is actually like.

One final word of caution to anyone who found this on a search: Appearing on a TV court show like “Judge Judy” involves signing off on a lot of legal fine print. You may want to consult an attorney to make sure your rights are protected before you pursue your 15 minutes of fame.

 Resources

Futon Critic: Ethics Panel Rips TV Drug Court

Mental Floss: What Legal Authority Does Judge Judy Have?

Cleveland.com: Playing Hard to Get When Courted by Reality TV Court Show

Fact: Judge Judy Overruled by Judge Jeffrey

Futon Critic: Judge Judy Sheindlin, Host of Syndication’s #1 Rated Show “Judge Judy,” Signs Multiyear Deal Through 2020

Frugal Confessions: It Pays to Have Your Small Claims Case on a Court Television Show

Washington Post: The Lasting Appeal of TV’s Top Woman: Judge Judy

Vice: These Guys Made Up a Fake Case to Get on ‘Judge Judy’

Editor’s Note: This post has been revised to credit select information to FindLaw. 

Noel Diem

Law Street contributor Noel Diem is an editor and aspiring author based in Reading, Pennsylvania. She is an alum of Albright College where she studied English and Secondary Education. In her spare time she enjoys traveling, theater, fashion, and literature. Contact Noel at staff@LawStreetMedia.com.

The post What’s the Verdict? The Truth Behind TV Court Shows appeared first on Law Street.

The pageantry and anticipation surrounding the Olympic Games has subsided recently. The mismanagement by certain host countries (Greece and Russia among others) has had a sobering effect on future host-candidates. In other words, countries are still down to party at your place, they just don’t welcome you coming over and ruining their expensive city.

And no city makes headlines for being unwelcoming quite like Boston. Last Thursday, America’s bid city held its first community meeting on the 2024 Olympics at Suffolk Law School. The organization No Boston Olympics–a grassroots coalition that has seemingly summoned the hospitality of Louise Day Hicks–was a vocal participant at the meeting. Essentially, No Boston Olympics feels the cost of hosting the 2024 Games would financially cripple the city, and everyone within the blast radius would foot the bill via taxes. The group makes a strong point: spending lots of money often sucks. But like other groups of contrarian fiscal hawks (see: Tea Party), they don’t see the entire picture.

The truth is, the success of the Olympic Games usually depends on who’s hosting. Greece, a country whose debt is becoming as famous as its Baklava, has not rebounded from hosting the 2004 Olympic Games.  Russia, which is having difficulty financing its own imperialistic urges, is now also struggling to pay off the 2014 Sochi Olympic Games.

On the flip side, the 2008 Summer Olympics turned a profit in Beijing. The 2012 Games in London, which were not cheap, could generate up to £40 billion in economic growth for England by 2020. Are those examples too foreign for you? The good ol’ US of A turned a profit after the ’96 games in Atlanta. As we did for the ’84 games in Los Angeles and then again for the Salt Lake City Winter Olympics in 2002.  Don’t we have faith that an Olympics in Boston would follow the lead of England or prior American Olympics rather than those games in Greece and Russia?

Here are a couple of reasons why Boston could be a good spot. The CEO of the 2002 Salt Lake games–Mitt Romney–lives in the area, and Boston is where his venture capital firm is headquartered. Not only is he local, but he also could have some free time on his hands! This is not a joke. Speaking of saviors for winter sports, do you know who else calls greater Boston home? Bob Kraft, the Patriots owner who privately financed his new stadium and turned a moribund afterthought into a four-time Super Bowl winning machine. He’s also been fingered as an adviser for the 2024 bid. Another big name is Red Sox owner John Henry, who was one of the few people who made millions during the 2008 recession and has already approved of Olympic use for Fenway Park.

This really isn’t a coincidence. There are many people in Boston who manage money well and who know the business of sports. It’s also densely populated, connected by a major subway system, and has vacant college housing during the summer. You get the point. Now let’s hear some counter-points courtesy of Boston.com’s coverage of the committee meeting.

1. “Members of Boston Homeless Solidarity Committee questioned why  . . . a cure for AIDS couldn’t get the resources and attention that an Olympic bid might.” (You can host the Olympics when you cure AIDS. Deal, fat cats?)
2. “At one point during Mandredi and Blauwet’s presentation, they showed a rendering of the proposed beach volleyball stadium on Boston Common. That idea drew hissing.” (Boston Common is for ice skating and for smoking pot in between Emerson classes. Not beach volleyball.  GAWT IT? If Boston wins the bid, don’t be surprised if there’s a spinoff protest for this particular issue. #NAWTOWAHCAWMIN)

Being frugal about local resources is understandable. People want the T (subway) fixed. People want better infrastructure. And people want these things completed quickly, without being too expensive. Well you know what could potentially make that happen? The Olympics. This isn’t that novel of an idea. If the International Olympic Committee and the United States are pushing for a smooth, seamless Olympics, you’ll probably get outside funding to fix some of your local problems. Romney got $3 million from the federal government specifically to help extend Salt Lake City’s light rail for its Olympics. In fact, for the last three American Olympics the federal government has spent $1.4 billion to improve the host cities’ transportation and infrastructure, a figure that will increase considering the government knows how inflation works. This money comes in addition to the millions that these cities receive from outside investors and through corporate sponsorship.

I realize many in Boston still suffer from a Big Dig hangover. That mega-engineering project spiraled out of control and the debt won’t be paid until 2038. But one bad investment–and its badness is debatable–shouldn’t stop the city from taking some financial risks in the future. The list of potential hosts is getting smaller, which means the IOC will soon be forced to scale down the costs involved in hosting the Olympics, which means the possibility of profit could be even greater. So while this may not be an obvious opportunity for Boston, maybe we should fully evaluate the idea[r] before calling in the militia. I mean, who doesn’t love a pahty, kid?

Andrew Blancato

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