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Decades; CEO of Wells Fargo Slapped with $185 Million Fine; Updates
from New Jersey Train Crash Investigation. Aired 5-6p ET - Part 2>
And Hillary, in that instance, was really telling a room of her supporters, look, this is what these young people -- they're frustrated. They're disappointed. They're right to be feeling what they're feeling and you have to be patient with them and you and we have to understand why they are concerned about the issues they're concerned about.
They are supporting Bernie Sanders. And she would say this publicly, frankly. I mean, she was very public about the idea that she believed that some of the things that he promised, she just did not believe were doable. I mean, when we had this long conversation throughout the primary, for example, about the affordable care act.
I find it very interesting though that just this morning on one of the morning talk shows, Bernie Sanders himself said he completely agreed with Hillary. That he did have a number of very young, idealistic people who wanted to -- who were frustrated and that it is important that we pay attention to that.
(CROSSTALK)
HARLOW: She called some of those -- I hear you, Karen, but she called some of those ideas indispensible and now she is wrapping her arms around them. She called some of them false promises for the voters ...
(CROSSTALK)
FINNEY: But Poppy ...
(CROSSTALK)
HARLOW: ... that are idealistic.
(CROSSTALK)
FINNEY: ... I think you're absolutely mischaracterizing -- I think you're absolutely mischaracterizing what we're talking about. I mean, Bernie Sanders talked about free college. That is not what Hillary is talking a about.
Hillary Clinton is talking about debt-free college. She's talking about, how do we help people refinance their existing debt, how do we make sure that for certain people living within certain income levels, how do we make sure that they can go for free?
So it's not an across the board free college for everybody. She continues to believe that we, as taxpayers, for example, should not be paying for Donald Trump's kids to go to college.
So, I take issue with your characterization. And what I would say to you is, what is part of this process, there were a number of ideas that Senator Sanders was campaigning on that our campaign looked at and said, OK, how do -- this is a part of our platform process. But how do we bring these ideas together?
But I think the more important point here is that she was very bluntly speaking to the frustration that a lot of people were feeling. I think she was being very honest with her own supporters and a lot of what she said there, she also talked about publicly.
And I want to say, last thing -- one last thing on the issue of the taxes, because I do think that at the end of the day, this election is going to be about two very different visions of our country. And you're going to see that on Tuesday night in a debate between Tim Kaine and Governor Pence. And what you're going to see in large measure when we talk about taxes is someone who has a plan to make our tax system more fair. To lower taxes on the middle class. To make it easier for small businesses and really ...
(CROSSTALK)
HARLOW: Karen ...
(CROSSTALK)
FINNEY: ... lower taxes on small businesses, not trickle down economics, which is what Donald Trump is peddling (ph).
HARLOW: Right. I'm getting the wrap. I appreciate you taking the time.
FINNEY: You bet.
HARLOW: I didn't get through half of my questions, so please come back.
FINNEY: You got it.
HARLOW: Thank you very much.
Coming up, a criminal enterprise with gutless leadership on par with Enron, not my words, the words of lawmakers taking on the CEO of Wells Fargo this week after the company created millions of fake account with real people's information and then fired 5,300 people for doing it.
Ohio Senator Sherrod Brown joins me live on what congress is going to do about it.
[17:30:00] (COMMERCIAL BREAK)
HARLOW: One of this country's largest banks did something almost unheard of in American politics these days. It put lawmakers from both parties in the House and the Senate in almost unanimous agreement. They're furious at Wells Fargo, which got slapped with $185 million fine for creating millions of fake customer accounts. This man was in the line of fire at two separate Capitol Hill hearings -- Wells Fargo CEO John Stumpf.
Democratic and Republican finance committee members hammered him on his bank's allegedly fraudulent sales tactics. Some called Wells Fargo a, quote, "criminal enterprise." Others said the bank is too big to manage and should be broken up. The ranking member of the Senate banking committee says Wells Fargo would have continued profiting for the sham accounts perhaps had it not been uncovered by the media.
(BEGIN VIDEO CLIP)
SEN. SHERROD BROWN (D), OHIO: Wells Fargo's reaction has been remarkable. It did not treat this as a big problem until it appeared in the newspapers. It did not begin to make customers haul (ph) until this year. And we don't know whether the bank chose to do so or was told they had to do so.
(END VIDEO CLIP)
HARLOW: Senator Sherrod Brown joins me live from Cleveland. Thank you for being with me.
BROWN: Good to be with you. Thanks, Poppy.
HARLOW: When you and your fellow committee members grilled Stumpf on September 20th, since then, some members of the House committee called for Wells to be broken up. They say this bank is too big to manage, to oversee, it should be broken up. Do you think that is the remedy here?
BROWN: Well, that's one of the remedies. I was the -- Senator Kaufman of Delaware and I had legislation back in 2010 trying to amend Dodd- Frank to break up the six largest banks. So I supported that idea for a better part of a decade. I mean, this bank clearly is too big to manage. It's too big to fail and it's probably too big to regulate.
You know, you look at all the things that were going on that the CEO for three years, four years, five years, six years, he said he didn't even know about. And either he didn't tell the truth or give him the benefit of the doubt, its management structure with a lot of problems, or the bank is just too big to really run. I think it could be all three of those.
HARLOW: You also said in those remarks to Stumpf -- you called Wells Fargo, "downright hostile to aggrieved customers." And you pointed out something that may not have gone a lot of headlines but it's really important. It's the facts that Wells Fargo customers are bound by something known as mandatory arbitration clauses. And that means they can't sue the bank. They can't take them to court. You find that outrageous.
[17:35:00] BROWN: Well, it's outrageous. First of all, the mandatory arbitration clauses generally the fine print, credit card agreements sometimes when you open any kind of account, you sign your name to a bunch of things -- I'm not a lawyer -- if you're not a lawyer, you typically don't see that, maybe don't read it. And if you do, you may not understand it. That was bad enough. But the second thing, they created these fraudulent accounts, signing your name, and they're enforcing the mandatory arbitration clause on those accounts you didn't even sign.
So, I don't know that that stands up in a court of law but it's particularly egregious, not to mention arrogant, for a bank to say you can't sue when they committed that fraudulent behavior against you -- towards 2 million accounts. We don't know how many customers that they inflicted this on, but we know it was 2 million accounts and I assume hundreds of thousands of customers, for sure.
HARLOW: Several Republican and Democratic lawmakers have alleged that Wells sales practices may have actually gone as far as violating federal law, potentially federal racketeering laws -- those are just allegations. But if that is the case, that would constitute a criminal offense. I wonder if you think that John Stumpf should be criminally charged here.
BROWN: Well, I don't know enough to know that and I don't make judgments like that. I do though encourage the Justice Department to look into criminal activities not just for the whole management structure. And what in fact they knew and what they continued to do. And you know, fundamentally, it's also this, you have 5,300 employees fired over a five-year period and top management didn't seem to know that.
You also had probably thousands, certainly hundreds of people fired because they didn't meet the sales quotas which the company has acknowledge were too aggressive. Then you have hundreds, maybe thousands of people who quit because of that pressure. And these are people making $12, $13, $14 an hour. The average teller in this country makes $12.50 to $13 an hour.
HAROW: Right.
BROWN: They all did that in service to the top management getting tens of millions dollars in bonuses. So, these low-income workers were pressured, some fired, some quit in disgust, some did things they shouldn't...
HARLOW: So what should happen to them?
BROWN: ...all in service to millions of hours a year.
HARLOW: I mean, what should happen to them if you think about their families and they were relying on the salary?
BROWN: Well, I think first of all, the bank needs to make the customers whole whose credit ratings may have been affected...
HARLOW: Right.
BROWN: ...which means they're paying $20 a month more on a mortgage for the next 30 years -- 7,000 or $8,000 more. The employees, they need to make some of those employees (inaudible). The employees engaged in wrongdoing, and that's pretty much it. They should not be rewarded, of course.
But the ones they put pressure on that might have quit because of that or they fired -- this is like -- there's a lot here that we don't yet know about and these hearings need to continue. And I want to see other Wells Fargo executives come and talk to us on the record and talk to us under oath.
HARLOW: Yeah, not to mention the woman who ran that division left with a $77 million golden parachute.
BROWN: Yeah.
HARLOW: Stay with me. We're going to get a break in. You're going to join me next. We're going to talk about politics and the vice presidential debate coming up on Tuesday. Stay with me.
[17:40:00] (COMMERCIAL BREAK)
HARLOW: Senator Sherrod Brown is back with me, live from Cleveland. All right, let's talk a little politics and a little debate because the VP debate, obviously, is on Tuesday night, and a lot of people thought you we're on the short list to be Clinton's vice presidential running mate. If you were Tim Kaine or you were giving him advice in this debate, what would your advice be?
BROWN: Well, I think he continues to make the contrast between Donald Trump and Hillary Clinton. That Hillary Clinton is the most qualified person to be commander-in-chief to run for president perhaps since Dwight Eisenhower or maybe my whole lifetime and Donald Trump is agreed by so many analysts and commentator and the Republican leaders and others the least qualified to be president.
And I think there are so many examples of that. You saw that last week in the debate between Trump and Clinton. And I think you'll see it as Tim Kaine points it out.
HARLOW: You did -- you did but I would push you on that a little bit because the post-debate polls show them neck and neck. I mean, they show them within the margin of error by a three-point spread at the most so, that's the argument that's been made and it's not widening the gap.
BROWN: Well, it's true. I think it's true.
HARLOW: It's true. I'm just saying what do you do that's going to work?
BROWN: Well, I think since the debate, you've seen movement here. I mean, people, you know, I'm not making this about the media but this sort of false equivalency, you know, they're both dishonest and both unpopular. I mean there's no comparison. Look at something like PolitiFact that checks on candidates statements. Donald Trump at the rate of like four times or five times the number of false statements that Hillary Clinton makes or whatever the numbers are, they're overwhelmingly different.
HARLOW: I guess when I was agreeing with you and...
BROWN: I mean, that sort of false equivalence, you guys have like -- I'm not here to attack the media but you've let that stand. Media is better at it than they were, but again, she is the most qualified, period. He is the least qualified. I think voters are seeing that. Not to mention his, you know, what he's been saying about women and probably making fun of disabled people and all those things, and I think you're going to see these numbers open up. Hillary Clinton is going to carry Ohio.
HARLOW: Very quickly, when I was agreeing with you on in your last statement where I said that's true, I was saying it is true that indeed, the gap is not getting any wider.
BROWN: Well, no, I think the gap is getting wider. I think since the debate, slowly it's began to pick up in a lot of swing states. Hillary Clinton is going win Ohio. I mean I've been in politics in the state for a while and I know the state as well as anybody. She's going to win the state. She's going to win this state because she's fighting for the right trade policy. She fights for the middle class. She understands foreign affairs. She's going to do well especially among suburban educated women. She'll going to win the state.
HARLOW: Senator, I got go leave it there. They're telling me if I go any longer those bars are going to come up because your satellite is going to drop. Thank you for being with me, senator. We appreciate it.
BROWN: Thanks. Glad to be here. Thanks. HARLOW: Coming up back after the break, trouble for the investigation into that fatal train crash in Hoboken, New Jersey. A key piece of evidence we've now learned may not be able to shed any light into what caused the deadly crash. A live report next.
[17:45:00] (COMMERCIAL BREAK)
HARLOW: Breaking news from that investigation into the fatal crash of that train in New Jersey last week. The NTSB now says that the train's event recorder was not working when the train crashed into the station. It left one woman dead, 114 people injured. Nick Valencia is with me now. I mean, this is critical, right? This is what tells you what was happening, how fast it was going, et cetera, up until the crash.
NICK VALENCIA, CNN CORRESPONDENT: Critical indeed and a bizarre development. I'm not sure if we've heard of anything like this happening before but NTSB investigators announcing at a Sunday afternoon press conference the one event recorder that they managed to recover from this mangled train wreckage was not functioning at the time of the accident. The NTSB official said that this is a relatively old event recorder, Poppy, dating back to 1995.
She said usually, when they're this old, they're replaced. But that clearly did not happen. Whether it was a technical error, engineering glitch or something else, all of that will be part of the investigation. There is a second recorder still on the train currently but because of structural damage and other things, they haven't been able to get to it. All of this was discussed earlier at the press conference.
(BEGIN VIDEO CLIP)
T. BELLA DINH-ZARR, NTSB VICE CHAIRMAN: Yesterday our recorders experts worked with the experts from the manufactures to access data from the recovered locomotive event recorder, which was built in 1995. Unfortunately, the event recorder was not functioning during this trip.
(END VIDEO CLIP)
[17:50:00] VALENCIA: The crash happened on Thursday morning, packed with commuters. It hit a bumper block and went airborne killing a woman and also injuring more than hundred people. That curve that it was on, Poppy, right before the crash, the speed limit 30 miles per hour. According to investigators, the train was going about 43 miles per hour.
Also part of the investigation is another train back in 2011. It missed it stop also at this Hoboken stop. They're going to look into that and see if there's an overall glitch in the system, but certainly a bizarre development that this event recorder was not functioning at the time of the accident. Poppy.
HARLOW: Not at all. Nick, thank you for the reporting. Quick break. We'll be right back. (COMMERCIAL BREAK)
HARLOW: All right, now a speak peek of the next episode of "Parts Unknown." Anthony Bourdain heads to Nashville to take in the city's lively music and rich cuisine.
(BEGIN VIDEO CLIP)
(MUSIC PLAYING)
ANTHONY BOURDAIN, CNN PARTS UNKNOWN HOST: Nashville, Tennessee. When I plan to do a show here, I was saying, you know, everybody just shows about the music in Nashville, but then we got really, really lucky.
[17:55:00] (MUSIC PLAYING)
BOURDAIN: So prepare yourself. This show's all about music and it is filled with the most awesome music ever in the history of the world, maybe even the universe.
(MUSIC PLAYING)
(EMD VIDEO CLIP)
HARLOW: "NASHVILLE PARTS UNKNOWN" tonight 9:00 p.m. eastern. Only right here on CNN.
And coming up...
(COMMERCIAL BREAK)
HARLOW: Top of the hour. I'm Poppy Harlow in New York and we begin this hour with what is the first look at Donald Trump's elusive tax records. The "New York Times" revealing that tax documents anonymously mailed to the paper show Trump's may have avoided paying federal income taxes for nearly two decades, why? Because the 1995 records show the businessman reported losing almost a billion dollars in one year and that allowed him to take advantage of major tax breaks. The possibility that Trump did not pay federal income taxes is something Clinton brought up just last week in the debate.
(BEGIN VIDEO CLIP)
[18:00:00] CLINTON: Maybe he doesn't want the American people, all of you watching tonight to know that he's paid nothing in federal taxes.
(Byline: Poppy Harlow, Cristina Alesci, Nick Valencia )
(Guest: Jack Kingston, Karen Finney, Sherrod Brown )
(High: Trump may have paid no federal income taxes entirely for nearly two decades. Tax documents show $916 million loss in 1995. Hillary Clinton coping with fallout from leaked audio. Clinton; "Free college" is part of "a false promise". CEO of Wells Fargo created millions of fake account with real people's information. One of this country's largest banks did something almost unheard of in American politics these days. It put lawmakers from both parties in the House and the Senate in almost unanimous agreement. They're furious at Wells Fargo, which got slapped with $185 million fine for creating millions of fake customer accounts. This man was in the line of fire at two separate Capitol Hill hearings -- Wells Fargo CEO John Stumpf. Democratic and Republican finance committee members hammered him on his bank's allegedly fraudulent sales tactics. Some called Wells Fargo a, quote, "criminal enterprise." Others said the bank is too big to manage and should be broken up. The ranking member of the Senate banking committee says Wells Fargo would have continued profiting for the sham accounts perhaps had it not been uncovered by the media; Senator Sherrod Brown is back with me, live from Cleveland. All right, let's talk a little politics and a little debate because the VP debate, obviously, is on Tuesday night, and a lot of people thought you we're on the short list to be Clinton's vice presidential running mate. If you were Tim Kaine or you were giving him advice in this debate, what would your advice be?; Breaking news from that investigation into the fatal crash of that train in New Jersey last week. The NTSB now says that the train's event recorder was not working when the train crashed into the station. It left one woman dead, 114 people injured. Nick Valencia is with me now. I mean, this is critical, right? This is what tells you what was happening, how fast it was going, et cetera, up until the crash. )
(Spec: Politics; Elections; Economics; Taxes; Education; College; Money; Stocks Exchange; Wells Fargo; CEO; Fraud; Banking System; Criminal Enterprise; Tim Kaine; Vice Presidential Debate; Disaster; Accidents; NTSB; Event Recorder; Income Tax Returns)