So it has come to light that Wells Fargo employees did the following:
On Thursday, federal regulators said Wells Fargo (WFC) employees secretly created millions of unauthorized bank and credit card accounts — without their customers knowing it — since 2011.
The phony accounts earned the bank unwarranted fees and allowed Wells Fargo employees to boost their sales figures and make more money.
“Wells Fargo employees secretly opened unauthorized accounts to hit sales targets and receive bonuses,” Richard Cordray, director of the Consumer Financial Protection Bureau, said in a statement.
In other words, the bank went one step beyond what they normally do, which is to create money out of thin air when a customer requests it. They obviously decided, “Why wait around for customers to come in and ask us to create money for them? Why not just do it on our own? That way we can earn all the fees from securitization and the deposits that these bank and credit card accounts will give us.” In other words, “We’re not creating voluntary debt slaves fast enough, so what’s to stop us from involuntarily chaining people to debts that they don’t even know about (answer to that question: certainly not the paltry fine Wells was charged nor the immunity they were granted)?”
Yes, credit card “receivables” are securitized, just like home loans. That’s one reason they’ll give a credit card to just about anybody—to be able to sell it into securitization after originating the account, thereby selling off any risk to the bank into the open secondary market for credit card debt. For example, here is Wells Fargo touting its “credit-card-backed” ABS, among many other types:
Asset-backed securities (ABS) – Gain access to both consumer and commercial asset-backed securities, including those backed by credit card, auto, student loan, container, and rail car receivables, among others.
How many of the fake Wells Fargo credit card accounts were securitized, generating all manner of fees? No one that I’ve seen is really talking about that particular aspect of this situation, but if I had to hazard a guess as to an exact number, I’d guess 100%.
Keep in mind that credit card applications are, for the purposes of the bank’s treatment of them, more or less the same as a promissory note. Indeed, this Wells Fargo credit card application includes a section called “Promise to Pay,” which states the following on p. 4:
(9)Promise to Pay
.When you use your Account or let someone else use it, you promise to pay the total amount of the Purchases, Cash Advances, and balance transfers, plus all interest, fees and other amounts that you may owe us. We may limit or close your Account, but the terms of this Agreement will apply until you pay the Account in full.
And as we all know, “promise to pay” is the magic phrase that creates a debt, same as in a promissory note! Further down, there are more references to a “promise to pay,” such as this one on p. 7:
•Minimum Payment. You promise to pay the Minimum Payment due by the Payment Due Date.
The fact that Wells Fargo maintains the right to securitize your account is contained in the following language on p. 9:
.We have the right to assign your Account to another creditor. The other creditor is then entitled to any rights we assign to them. You do not have the right to assign your Account.
So the idea that a bank is restrained from creating money just whenever it wants has now been proven to be totally false. We already knew that banks manufacture currency out of thin air as part of their “divine right” of money creation, but the one check on that has always been that they could only do it when someone asked for a “loan.” That is, the customer was at least in control of deciding whether or not to take on a debt via the magic “promise to pay.”
But now we have confirmation that they can and do just create money—in the form of checking accounts and credit card accounts—whenever they damn well feel like it. And they can make you responsible for it–removing your control of what debts you will or will not have to pay. The news coverage of this situation has often referred to the accounts as “fake,” which they were, just as the money that was created by these accounts is also fake, but both the accounts and the money they created were treated legally as very real, which is the entire problem with the monetary system as it currently exists. Creating money out of nothing upon request was already and bridge too far, so this new revelation is just absolutely beyond the pale. That’s too much power. And if anyone thinks Wells Fargo is the only bank that did or would do this…think again.
The banks have to be seized, shut down, and the power of money-creation given back to the people individually as I have written about many times…