Seattle says "no more" to Wells Fargo. But were they right?

March 11, 2017

 

A man walks into a bank and says “I’d like to withdraw three billion dollars please.” The teller looks at him at responds “sure!”

 

This isn’t an every day interaction but it just happened rather recently in Seattle, and could be happening in San Francisco.

 

Wells Fargo, the countries third largest bank by assets, just had Seattle remove three billion dollars from their bank. That sounds like a lot of money, and no doubt it is, but in the eyes of a bank like Wells Fargo it might as well be $5.

 

But it’s important to note why Seattle did this, what led them to this point and where they’ll be putting their money next.

 

It all starts with an oil pipeline. Wells Fargo helped fund the company who is contracting the Army Corp of Engineers to hire workers who will eventually build the pipeline known as the DAPL.

 

And Seattle was unhappy with this move by the big bank. So their city council voted, 9-0, to pull all of the cities funds out of the Wells Fargo.

 

But Seattle has got a couple of issues.

 

Issue number one: the pipeline just got clearance to be completed and should be done within the next couple of weeks.
 

Issue number two: CITI Bank, Bank of America, and JP Morgan Chase also helped with the pipeline. Where are you going to put your money?
 

Issue number three: How much does three billion hurt the 1.9 trillion dollar bank?

 

So what appears from the outside to be a PR issue for Wells Fargo might actually be more of a dangerous move for Seattle.  They wanted to be progressive but instead of fighting a more current issue, they chose a smaller one that no longer gets the biggest press coverage.

 

And now Seattle has to find a new place to put their money. But where? Because if they put it into CITI Bank, BofA or JP Morgan Chase, now you’ve got a PR nightmare because all of those banks helped fund the DAPL as well. 

 

Seattle is all about statements. I understand. But they made a statement that isn’t really moving the political needle. If I’m Wells Fargo, the burden of losing the cities business doesn’t change the grand scheme of things for me. I’m no WSECU, I’m Wells Fargo. I’m not Columbia Credit Union, I’m Wells Fargo. I’m the stagecoach, I’m history, and my bottom line is about making money, not fixing every issue a city council wants to try and bring up.

 

So I hope Seattle keeps making statements. But ones that will do more to help benefit them and their citizens.

 

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