The rule of law? (talk about “money laundering”)

Wells Fargo Home Mortgage (WFC) has fired a Des Moines worker over a 1963 incident at a Laundromat involving a fake dime in the wake of new employment guidelines.

Richard Eggers, 68, was fired in July from his job as a customer service representative for putting a cardboard cutout of a dime in a washing machine nearly 50 years ago in Carlisle, the Des Moines Register reported Monday.

Warren County court records show Eggers was convicted of operating a coin-changing machine by false means. Eggers called it a “stupid stunt,” but questions his firing.

Big banks have been firing low-level employees like Eggers since new federal banking employment guidelines were enacted in May 2011 and new mortgage employment guidelines took hold in February, the newspaper said. The tougher standards are meant to clear out executives and mid-level bank employees guilty of transactional crimes — such as identity theft and money laundering — but are being applied across the board because of possible fines for noncompliance.

Here is more, courtesy of Tim Johnson.


An alternative title would be The rule of morons".

Isn't this called "low hanging fruit"?

I feel SO much more confident that the "global financial crisis" is being solved knowing they fired him.

But if you look at the article and accompanying picture you know he was fired for sartorial infractions....

it's common for all companies to find any excuse to can an employee before they can collect a pension...

Liberal Fascism.

Come on derek, you can see the pattern. Government says "don't discriminate" and banksters say "OK, watch me make bad loans!" Government says "purge bad actors" and banksters say "OK, watch me fire a guy who stole a dime!"

I see a pattern: nobody has ever used the word "bankster" and made a persuasive argument at the same time.

We programmers think naming is arbitrary.

Who's this "we" Kemo Sabe?

What about the words "Liberal Fascism"?

Every elected official should be required to take a course in "unintended consequences" - with this as a main exhibit...

Reaffirms my belief in less government is always preferable...

The Libertarians who want a regulation free Wall Street have essentially gotten their wish and retail investors are increasingly refusing to do business with the resulting criminal cartel.

Pretty clearly, honest dealing and fair financial statements are not going to arise spontaneously on Wall Street through market forces. If we want retail investors to come back to the market the government has to establish and enforce a credible regulatory structure.

However, this is the end result of your "credible regulatory structure." It is absurd to claim that this is a regulation free Wall Street.

You may indeed be entirely correct that some regulations need to be changed, and some areas are not regulated enough. But this one particular case entirely the result of government establishing regulation along the lines you desired to encourage honest dealing.

Unfortunately, you decided to be a blind ideologue, responding with your stock answer and your inability to view the world as it is, instead of how you'd like it to be.

Some libertarians are that way too, imaging the market to be perfect. In reality, both government and the market are flawed. I believe that generally government regulation is more flawed, and this one example bolsters my point (but I'm sure you could find counterexamples for the other side.)

To paraphrase Arnold Kling:

Freshwater says: markets work, use markets.
Saltwater says: markets fail, use government.
Mason says: markets fail, use markets.

No one says anything about Government fail?

Government failure is taken as a given. :^)

>The Libertarians who want a regulation free Wall Street have essentially gotten their wish

That is priceless. Crony capitalism is the antithesis of libertarianism.

Crony capitalism is the antithesis of libertarianism.

So, you don't think that allowing all the major banks to fail would have resulted in a massive move to the left by the voting public, just like happened back in '32?

With deposit in insurance, I'd be willing to risk it. This country was a heck of a long way from 1929-32 in 2008-9.

"With deposit in insurance, I’d be willing to risk it. "

Isn't that just bailing about foolish banks and their too trusting depositors?

This country was a heck of a long way from 1929-32 in 2008-9.

No, we weren't we were just as much on the edge as we were then.

Wrong. It's regulatory capture. With the Fed backing the whole shebang, there is literally nothing left to regulate.

"The Libertarians who want a regulation free Wall Street have essentially gotten their wish and retail investors are increasingly refusing to do business with the resulting criminal cartel."

If that is the case I do wonder what all those pages in the federal register are for? I wonder what all these words signify? I wonder what it is that the employees of the SEC, CFTC, FINRA, OCC, CFPB, and others do all day?

"I wonder what it is that the employees of the SEC, CFTC, FINRA, OCC, CFPB, and others do all day?"

I have no idea what they do. I know that Bernie Madoff ran a high profile ponzy scheme for years and they didn't notice, they were warned about Enron and did nothing, they weren't able to require MF Global to keep client money separate or maintain accurate books and records of transactions and a derivatives market ten times the size of the real economy chugs along threatening to blow up the whole financial system unmolested by any of those agencies. Maybe they are spending their time chasing down petty crimes from half a century ago.

Joe, What you're missing is that Madoff and Enron and MF Global all happened with massive government regulations... books and books of it, billions and billions of dollars spent every year on it.

At some point you have to admit that it's not working.

Maybe if we let the company owners be responsible for losses and didn't bail them and their customers out, people would have an incentive to be more careful?

How can you say that when staring at an article about a regulation intended for Wall Street?

Libertarians tend to recognize that both unintended consequences and regulatory capture are real things. I personally do not trust our regulators to properly apply the laws to big business executives rather than find ways to absolve them of those laws. I can't speak for all libertarians, but I think a lot of us realize that the power to regulate is a corrupting force in the government, and that regulations often end up being moot.

If I were to take your statement at face-value, then the answer is simple: add more regulations, everything gets better. That is naive when you look at the facts on how our [you may say few] regulations are applied in reality (i.e. RTFA).

Would there be unintended consequences in less government?


No, they are all intentional consequences

Of course there would be. But I believe that in most cases it would still work better than more government or the amount we have now.

There are exceptions, certainly, but the vast majority of libertarians I know acknowledge the imperfections of the market. It's strange that you consider this a decisive argument. You must have nothing better to offer, and are too unwilling to admit that in this case the government regulation you support had a negative unintended consequence.

Your reaching for snark I will take as simply an admission that your position is untenable, a mere attempt to distract.

Unfortunately if your entire argument is just that things would frequently work better with less government, you aren't really a libertarian. Sorry, you've lost your principle opposition to state action. Now you have to debate the liberals on their own terms, and they've been at it for over a century. Get involved in the discussion if you want, but the empirical basis for the claims you'll want to make is severely lacking. Public choice theory did some good work for libertarians, but it still rests heavily on assuming away a lot of market problems and, on the balance, doesn't look so great in retrospect. A lot of of libertarians think this route makes sense because defending principled libertarianism is also pretty difficult, but it doesn't really get you very far.

There is a difference between being libertarian and being more libertarian. After all all libertarianism is a compromise that accepts that government has some role.

I am really sick of both this straw man argument and the idea libertarianism = anarchism

"I am really sick of both this straw man argument and the idea libertarianism = anarchism"

Well, I'm not thrilled of the idea that liberalism = socialism, but I seee that all the time in this here corner of the interwebs.

Except for all those instances where libertarianism does equal anarchism (Rothbard, David Friedman, C4SS, &etc)... (This is not to say that every instance of libertarianism is anarchist.)

"Well, I’m not thrilled of the idea that liberalism = socialism, but I seee that all the time in this here corner of the interwebs."

I'm not thrilled by the idea that liberalism = American liberalism. Where I come from you can be a liberal and an anarchist.

In the meantime, NOTHING, has been done to the people who "disappeared" a billion dollars of client money at MF Global.

If nothing has been done, then clients really are muppets.

Ah, but banksters made an example of Mr Eggers, and that was all the libertarians need to ignore the rest. A dime .. a billion .. no difference right? Of course the internal investigation had to root out the dime first!

Very confused by your reference to libertarians here. Clearly the regulations are not doing anything about the rest so what is your point exactly?

It's sad how many people here in Iowa blame Wells Fargo, rather than Congress and FDIC.More at .

Simple question, if Wells Fargo had just ignored the "dime crime" do you think there would have been any blowback? How can you think this is anything but the opposite, grandstanding to prove some point of their own?

They -- and other banks -- are firing many low-level employees with old violations. When the fine for "knowingly" employing an ex-con is $1 million per day (it is), and with an additional threat of prison, the rational response is to fire anybody who is questionable.

If I worked for Wells Fargo, how much could I make by whistle blowing that the bank knowingly broke the rules? You may think there is no blowback possible here, but I think you would be wrong.

Simple, three-part answer, John: Wells Fargo would fire members of its compliance department if they used discretion in complying or not with bank regulations, would fire members of its HR department if they created a "wrongful termination" road map by inconsistently making policy-based terminations, and would fire its GC if they advised anyone not to follow bank regulation because said regulation was stupid.

(And if Wells Fargo various departments ignored regulations, some NY AG would pad his political resume by using these foot faults to force settlement of a more specious pending indictment. Ancient Chinese Curse: May you come to the attention of the authorities.)

Of course it's grandstanding. There was mass robosigning of legal documents. Were there mass firings as a result? Maybe there were; if so, I'm going to expect a bunch of links posted below.

I was personally hoping for mass perjury indictments from the robosigning incidents (and subornation of perjury indictments for their supervisors) but that's just wishful thinking.

Was there a regulation requiring that people involved in robosigning be fired?

Isn't the whole point of robosigning that you don't need a lot of employees to do document review? Therefore, cancelling the program would not lead to "mass firings."

You are NOT allowed to create money.

Do lawmakers actually spend time crafting out specific criminal violations like "operating a coin-changing machine by false means"?

Well, "crafting" might be a bit strong.

No - the "crafting" is done by invisible and unelected public employees who are not accountable for the impact of their stupidity.

Lawmakers pass laws they haven't read.

perhaps we should say lawmakers pass laws they CANNOT read

They have to pass it to know what is in it.

Another thing they have in common with diapers.

If anyone believes this guy was fired for a coin-incident in 1960, they are crazy.

This person was fired because someone wanted him gone.

And then they blame it on a bank regulation. That is a two for one. Get rid of an employee you want to be rid of and blame it on the big bad government.

I await Rush Limbaugh's report on this outrage.

This! How is it possible to take that story at face value?

Exactly! Most of the comments just buy WF's comment on the firing at face value. Maybe it's WF trying to prove a point about the new regulation; maybe its a convenient excuse for this guy's immediate boss to get rid of him, for good or ill. Maybe its something else.

We don't know. But let's use confirmation bias to read the story in the way that best flatters our political leanings, yes?

Even your interpretation flatters our political leanings, yes. This guy's old, he could've sued for age discrimination (and maybe other stuff), he could've transferred within WF, he could've challenged his boss with HR, but this regulation gave his jerk boss a mithril halberd to cut the poor guy's head off and no one in WF could defend him without breaking the law.

Still an unintended consequence of stupid Democrat legislation, yes?

Why does this guy have a criminal record for putting a piece of cardboard in a washing machine??

Why did the Iowa legislature make this a crime?

Why did Iowa government bother to prosecute this crime?

Why did the court record this as a criminal conviction?

Maybe because the court had evidence he actually purposely committed a crime for profit?

Crimes like this have been used as part of "three strike" sentence enhancement to render life sentences in places like Texas (appealed to the Supreme Court as I recall), so is Texas dominated by liberal Democrats?

So a regulation that was aimed at making bankers more accountable and holds them to a higher standard turns out to be used to clean out some dead wood - without the same consequences that might be case if the regulations were not so "helpful".

The bank is "covered" because they can correctly point out that they would be subject to serious fines and consequences were they to chose to overlook this silly little offense - the rules are clear - read the article - spend time in jail [the subject spent 2 days] and you are not eligible for an automatic waiver.

Not grandstanding - in fact shareholders could have taken action against the bank if they willfully ignored the new reqs....

A couple of Libertariian points.
1. Less government is not the same as no government - I am not arguing for no regulation - just less regulation - and caution before enacting new regulation regarding this sort of possibility.
2. Legal action - tort - against the bank for wrongful firing is an appropriate solution - BUT not available to the subject because "the bank had no choice".
3. As a Libertarian I can probably accept the increased regulation if it were indeed crafted and understood by my elected representatives - but I would guess that as in most cases the specifics of the "rules" were not spelled out - but crafted by career public employees - who are both over paid and under qualified to do this sort of thing.

I'll give anyone 50:1 that they just wanted him gone.

I worked for a major institutional investor that fired a portfolio manager for complaining about a couple of squirrely deals, but did everything they could to hide his manager's record for "possession with intent to distribute."

Would they have fired him if he were 38 and the crime had occurred 20 years ago?
I think his being 68 was no coincidence.

YES they would have fired him OR BEEN FINED!!!!

They point of all of this is that some idiots in DC crafted a law that had these consequences...

Those of you who think the bank is somehow to blame for this would probably be screaming about why we need more regulation if they were found to be allowing "known criminals" to be hired and working on mortgage selection.

This is patently absurd. There is no way the federal government would have fined Wells Fargo for keeping a nearly-retired customer service rep with a 50-year-old misdemeanor on the payroll.

It is so, so strange how everyone here just swallows Wells' justification for this. Either someone hated him or he was ZMP or something, and this is the EXCUSE for firing him, not the actual reason.

"I think his being 68 was no coincidence."
In the article he says he's only worked for them for 7 years and that he makes $29,795 a year. If they were interested in culling older employees, they probably wouldn't be hiring 61 year olds in the first place.

Seven years ago the national unemployment rate was 5%. It is not outlandish that Wells Fargo might hire a 61 year-old in 2005, and fire a 68-year old in 2012.

Yes, the change in employment rate could well be a reason. If they think they can get a better employee now, they might consider replacing a poor worker. But they wouldn't need to fire him for this reason. Couldn't they just fire him for poor performance and hire another worker?

Wells Fargo is following the law. We could come up with all kinds of bizarre theories as to what their motives actually are, but in general the most obvious answer tends to be the correct one. I tend to believe they've decided to strictly follow a law which can cost them $1 million per employee for failing to follow.

It's odd when the most obvious answer is that a 'Bank' is interested in the bottom line (money) and wants to avoid a $1 million fine, people suddenly start finding alternate reasons for their actions.

If something like this actually resulted in purging known money launderers and identity thieves from middle-management and executive positions at banks, with the unintended consequence of taking out a few guys like this along the way, I'd still think that's worth it. Obviously, no legislation will ever be perfect (and U.S. legislation will be less perfect than most because of the way our lawmaking process works), but it's hard to imagine a convincing argument for not making it illegal for a money launderer to run a bank.

I'm guessing his age had something to do with it.

Has anybody asked the question if the bank should break the law because they think it's the right thing to do?

The bank didn't write the law, they simply followed it, as they should.

I would say that the law of unintended consequences strikes again, but the Feds seem to intend very strongly to create a class of dependent, unemployed people. After all:

"A wise prince ought to adopt such a course that his citizens will always have need of the state and him." - Machiavelli

Well said Nelson!

I am so sad that so many of my generation think it is OK to settle - we have been given so great a time - so great a country - so great an opportunity - shame on us for settling...

Iowa was a liberal Democratic state in 1968 that made it a crime for an adult to use even cardboard ro steal money from a vending machine, and was so wasteful of tax dollars they prosecuted and convicted a man for the crime of theft???

Just to create dependent unemployed people????

Texas has lots of hotels run by government and private jailers for people like this guy - if he did this three times, life residency at state expense including free room and board.

My point was not that any phase of Mr. Eggers' hardships was specifically engineered to create one new government dependent. Rather, it was that the federal government seems unconcerned with cleaning up unintended consequences, especially when they maintain or expand the people's need for that government.

I'm with the Ludic Fallacy people above. This is most likely not about unintended consequences. One data point, a gang of plausible theories, and no one who really knows the inside scoop.

Actually, if you read farther down, you get to the "New York Times" punchline subhead:

Rules hit minorities hard, lawyer says

Yolanda Quesada, 58, of Milwaukee, was fired from her customer service job at Wells Fargo Home Mortgage in May for a 40-year-old shoplifting offense. She’d been working there five years and was making $33,000. She said she stole work clothes as one of 12 children in a poor family.
The other three clients are all African-Americans, Bates said. He is concerned that the tighter guidelines are falling most heavily not just on low-level employees, but among minorities raised in poor neighborhoods where they engaged in youthful crimes to meet their basic needs.

My memory is slipping, but I seem to recall a saying about a road to someplace being paved with good intentions. Anyone else know the saying?

I know exactly what's going to happen. This ruling will disproportionally affect minorities, so the Government will turn around and compel the banks to hire nobody but criminals! It's the CRA all over again.

This is so wrong!

The bank should break the law, and risk hundreds of thousands of dollars in fines, so they can keep one easily replaceable employee!

After all, the bank has an obligation to their shareholders to do what is right and risk unnecessary expenses!

As long as the big guys are not fired for their big sins, and put in jail, the system won't change for the better.

By the way, why are criminal records kept for 50 years?

So the state can have sentences increased even if the crime occurred decades ago?

To revoke visas and deport resident aliens?

One dime was a foolish crime. If he had figured out a way to pass 1,000,000,000 dimes, he could have been running for president by now.

No, he'd probably have to figure out how to pass two or three billion dimes, not just one billion. :-)

This shows that somethings cannot be done by laws. The laws would have to be to complex for anyone to understand if they exempted cases like this.

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