The Seattle City Council should sever its banking relationship with Wells Fargo because of its past fraudulent activities and its partial funding of the highly controversial Dakota Access Pipeline. Both are clearly in violation of socially responsible banking practices.
GIVEN the current attack by President Donald Trump’s administration to halt efforts to address the threat of climate change’s impact on our environmental safety, it is critical that cities around the country respond. Their actions may be local, but they will have a national ripple effect. We can begin that surge in Seattle by building and expanding the legislation that has leveraged its power as a large banking customer to encourage socially responsible banking practices in the wider community.
In 2013, I introduced a Socially Responsible Banking ordinance to the Seattle City Council. That ordinance meant that socially responsible criteria accounted for 15 percent in the city’s decision-making rubric when considering banking contracts. Currently, the council is considering an ordinance that would take this a step further, meaning that socially responsible banking would be considered as a factor worth at least 20 percent in the city’s decision making process when it is deciding who it wants to work with on its banking business.
The proposed ordinance would also see the city end its current $3 billion relationship with Wells Fargo when its current contract expires at the end of 2018. The reason for this is Wells Fargo’s high-profile corporate malpractice as well as its funding of the highly controversial Dakota Access Pipeline. Both are clearly in violation of socially responsible banking practices.
Wells Fargo, along with 16 other banks, is a lender to the Dakota Access Pipeline project. Wells Fargo is lending $120 million as partof a $2.5 billion credit agreement funding the project, according to The Seattle Times.
The Council should pass this bill.
The rationale is clear: Wells Fargo was recently fined $185 million by federal and local regulatory bodies after directing employees to engage in fraud. Consumers paid dearly for Wells Fargo’s deceptive practices.
The public will again pay a hefty price for Wells Fargo’s practices if it continues to invest millions in the Dakota Access Pipeline, a project that has abused the treaty and water rights of the Standing Rock Sioux and would be a disaster for our climate. Seattle should not be in a relationship with a bank that engages in anti-consumer and anti-environmental practices.
The Standing Rock Sioux have stated repeatedly that allies in their fight need to target the investors of the pipeline by divesting from those funding the pipeline.
The time is now to take a stand for protecting our citizens from the consequences of these activities. In particular, since President Trump recently signed an executive order stating that construction of the Dakota Access Pipeline should be restarted as quickly as possible, it is critical that the City Council pass this ordinance.
What happens in Seattle does matter. Seattle was the first major city to raise the minimum wage to $15 an hour. Los Angeles, San Francisco, Washington, D.C., and the state of New York soon followed suit. And this is what is going to concern Wells Fargo executives: the thought that Seattle divesting will inspire other cities to do likewise. Such a scenario may have them worried enough to rethink their investments in the pipeline. If Wells Fargo rescinded its loans from the pipeline — which it is entitled to do under the Equator Principles, a guiding framework for responsible lending that Wells Fargo is a signatory to — it would open the doors for others to do likewise.
If enough banks pulled their funding, the project would collapse resulting in both financial and environmental savings for the general public. But first Seattle must align its dollars with its values and pass this ordinance.
The City Council should do so without delay by scheduling this important ordinance for a vote at the finance committee meeting on Wednesday.