Former Wells Fargo CEO: Govt Fine of BofA 'Has Nothing to Do With Justice'

Thursday, 21 Aug 2014 01:04 PM

By Dan Weil

  Comment  |
   Contact  |
  Print   |
    A   A  
  Copy Shortlink
The $17 billion settlement reached between the government and Bank of America for the bank's handling of mortgage securities in the run-up to the 2008 financial crisis doesn't represent justice, says former Wells Fargo CEO Dick Kovacevich.

"It's definitely politics," he told CNBC. "It has nothing to do with justice or restitution to the innocent victims. In fact, more of the money is going to the coffers of the states and various departments than the victims."

Some financial commentators have pointed out that the government's crusade against major banks only hurts their shareholders and employees rather than bank executives who perpetrated wrongdoing.

Editor’s Note: Dow Predicted Will Hit 60,000 — Buy These 4 Stocks Now

Kovacevich apparently agrees.

"Why are we charging the stock holders instead of going after the people who did wrong?" he asked. "Corporations don't engage in criminal behavior. They don't take advantage of innocent people. People do."

So why is the government chasing down banks instead of their executives?

"They are going after corporations because they can," Kovacevich said. "They aren't going after the individual because it takes a long time to do so."

To be sure, prosecutors reportedly are forming a civil lawsuit against Angelo Mozilo, co-founder of Countrywide.

Mark Williams, a former bank examiner who teaches finance at Boston University, shares Kovacevich's concern.

"The banks extracted billions from unassuming customers, and now Justice has extracted billions of dollars in settlements to make up for that," he told The Washington Post.

"But corporate executives should not be able to hide behind their companies and have shareholders pay for egregious behavior."

Editor’s Note: Dow Predicted Will Hit 60,000 — Buy These 4 Stocks Now

Related Stories:

© 2014 Moneynews. All rights reserved.

  Comment  |
   Contact  |
  Print   |
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Country
Zip Code:
Privacy: We never share your email.
 
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
You May Also Like

Yellen Doesn’t See Fed Raising Interest Rates Before April

Wednesday, 17 Dec 2014 20:31 PM

Signaling she's in no hurry to raise rates, Federal Reserve Chair Janet Yellen said the central bank is unlikely to move . . .

Leon Cooperman: Cuba 'Very Far Down on My List' for Investing

Wednesday, 17 Dec 2014 17:32 PM

While the U.S. government's decision Wednesday to resume full diplomatic relations with Cuba stirred starry-eyed talk of . . .

Ending of Cuban Embargo 'Will Be Fantastic' for Cigar Fans

Wednesday, 17 Dec 2014 17:15 PM

President Barack Obama's decision to resume full diplomatic relations with Cuba has made happy campers out of cigar reta . . .

Most Commented
Top Stories

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved