…Wells didn’t apologize for intentionally defrauding FHA (and harming homeowners) and one low level manager is the scapegoat? FHA doesn’t terminate or suspend Wells from the direct endorsement program? There is no discussion of an independent monitor, to ensure the loans Wells delivers to FHA now meet its parameters? There is no discussion of underwriting changes/improvements that have been made by Wells? And importantly, Wells’ shareholders and the market for its stock didn’t react at all, despite the seriousness of the government’s claims and mortgage lending and underwriting being at the core of Wells Fargo’s past, present, and future business model. Why? Because the government’s claims are largely false and most everyone important to Wells…its regulators, its shareholders and other institutional investors, and its employees know that to be the case and because Wells’ reputation won’t be damaged with its customers, because most aren’t paying attention and/or don’t care and/or don’t believe the government claims? I think it’s something like this. Love to hear your thoughts. What do you think?” Mike Perry, former Chairman and CEO, IndyMac Bank, April 12, 2016

Here are some of the industry responses I received privately (and so I have made them anonymous) to the above:

“Mike, Wells has impressed me over the years as being extremely well run, and I can’t believe they did anything wrong other than by accident. I like Dan Gilbert’s approach which is, dammit, we didn’t do anything wrong, we’re not writing a check, and we’ll fight you in court till hell freezes over. I’d like to have enough money such that, if something like this happened to me, I’d go on TV, say that I refused to knuckle under and admit to something I never did and then tell the world that effective tomorrow, I was closing the company.  And it would be great if I were the biggest lender in the country. What if Atlas shrugged?  Well, I just shrugged.”

“The fact that the government didn’t terminate Wells’ direct endorsement speaks volumes.  Wells is the best of the banks and conservative.  FHA audits every originator so where were they prior to the crisis.  It Is easy for any objective observer to assess the motivations of the government.”

“Mike, I look forward to discussing this when we are together.  I never thought wells did a thing wrong and all the regulators have done is push wells and others out of the fha market.”

“Interesting stuff, Mike..thanks for sharing.  I think you’re spot on…these governmental grabs are known for what they are by those who are informed and no longer cause gasps by their announcements…accepted for simple exercise of the government’s practice of extortion of financial institutions for damages not proven and amounts not supported by facts.  Blah, blah, blah…..you’ve heard it from me more times than we can count(!).”

“Mike: Nice to hear from you. To be candid, I have largely stopped paying attention to the myriad settlements the government has forced….including this one. I think your thoughts are generally on point, however. I found that when I focused on and stated any opinion on government actions in the wake of the housing crisis….I tended to get into trouble professionally. The last 8 years have not been a good time to be a squeaky wheel.”

Wells Fargo’s FHA Settlement Press Release, April 8, 2016

The Department of Justice’s Wells Fargo/FHA Press Release, April 8, 2016