*By Bridgette Webb*
Sen. Elizabeth Warren (D-MA) wants regulators to exert serious pressure on Wells Fargo ー pressure she hopes will result in the resignation of CEO Tim Sloan. But it's unclear whether the Senator's coaxing will have any real effect, said Pete Schroeder, a financial correspondent at Reuters.
"On paper, Warren can't make the Fed do anything," Schroeder said Friday in an interview on Cheddar.
The central bank is an independent regulator and technically can't make Wells Fargo ($WFC) do anything either, he pointed out. And the board "so far has been supportive of Tim Sloan."
"What's interesting with this new letter is that Warren is trying to enlist the Fed in her effort. Her argument is that you can't overhaul the bank's policies and keep Tim Sloan, who has been at the bank for 30 years," Schroeder said.
Wells first came under fire in 2016 when news surfaced that employees secretly created millions of unauthorized bank and credit card accounts without customers' knowledge. The phony accounts charged customers with unjustified fees and allowed Wells employees to boost their sales figures and earn more in commissions.
The massive scandal resulted in the ouster of then-CEO John Stumpf and the promotion of Sloan, who was the bank's president at the time. He'd also previously served as chief operating officer and CFO.
But under his leadership, issues have continued to rock the bank, including the news that it improperly repossessed military service members’ cars.
In a letter to the Federal Reserve on Thursday, Warren argued that Sloan is profoundly implicated in the bank's misconduct.
"\[She's\] really putting a lot of pressure on the bank and really pushing for \[it\] to really overhaul the organization, basically saying it's clear that they are not running the bank in anything close to an appropriate fashion."
According to Schroeder, "Warren has been on the bank from the first scandal."
In February, the Fed made the unprecedented move of ordering Wells Fargo to keep its assets below $2 trillion, saying the company had prioritized growth over compliance with regulation. Warren wants to keep that cap on business in place until Sloan is essentially forced to resign.
For full interview [click here](https://cheddar.com/videos/why-sen-warren-cant-force-the-fed-to-remove-wells-fargo-ceo).
California Rep. Ro Khanna has a novel idea about how to solve the government shutdown: call in some experts."Why don't we get an independent group of experts? The President appoints two people. The House appoints two people. The Senate appoints two people," the Silicon Valley-based Democrat suggested. "Put them in a room ー six folks ー and have them come up with proposals that are going to be 6-0."
With Los Angeles public schools ending a third day without their striking teachers, a deal between the union and the district remains elusive, according to Joseph Zeccola, a 2018-19 L.A. County Teacher of the Year and one of more than 30,000 educators currently protesting in the country's second-largest school district. "We're at a standstill," Zeccola told Cheddar from the picket line on Wednesday. "The offers right now have not been good."
The U.S. needs to work on improving its relationship with China as well as stabilizing its own economy by ending the government shutdown, JPMorgan Chase chairman and CEO Jamie Dimon said on Wednesday.
The ongoing government shutdown will hurt franchisees, Fat Brands CEO Andrew Wiederhorn told Cheddar on Monday. The closure of the Securities and Exchange Commission may inconvenience companies like Fat Brands, which need access to the public markets, but its franchisees, who run outposts of Fat Brands restaurants like Fatburger and Ponderosa Steakhouse, can't seek loans or expand their businesses. "There is a trickle down effect to us, but it's pretty small. I think really it affects the small business owner ... and it's coming out of their pocket," Wiederhorn told Cheddar.
Airline passengers are facing long security lines as unpaid TSA officers have begun calling in sick due to the government shutdown. Staffing shortages led to the closure of an entire terminal at Houston's George Bush International Airport. Local Houston TSA President, Freddie Cuellar, says closing the terminal is the best way to utilize the staff who are able to come to work.
These are the headlines you Need 2 Know for Wednesday Jan. 16, 2019.
President Trump has taken the government hostage, and House Democrats refuse to negotiate with a hostage-taker, House Majority Leader Steny Hoyer (D-Md.) told Cheddar on Tuesday. "This is not about the wall, it's not about health care, it's not about ... spending. This is about a promise the president made, and he has now taken the government hostage," Hoyer told Cheddar's J.D. Durkin as the 25th day of the partial government shutdown dragged to a close.
Canopy Growth is planning its entry to the U.S. on the back of the new Farm Bill ー and aims to establish a hemp "hub" in New York, according to CEO Bruce Linton."New York is setting up a pretty progressive approach and we have an earlier first license under that system so we can actually create a hub," Linton told Cheddar on Tuesday.
As the government shutdown drags on, calls from some conservative corners have increased for President Trump to declare a national emergency in order to get federal employees back to work while diverting funds to build a border wall. However, conservative radio show host Erick Erickson is cautioning the president against doing just that.
The cannabis industry enjoyed a productive 2018, but the government shutdown may be turning the industry's green light to yellow. Cannabis stocks are up overall, but according to Debra Borchardt, co-founder and CEO of Green Market Report, the government shutdown has left some farmers and companies in limbo.
