Coconino Voices: Flagstaff City Council can do better than Wells … – Arizona Daily Sun

The planet is in the throes of a climate crisis with the window shrinking to avert a climate catastrophe. In our beautiful and beloved northern Arizona community, we are experiencing this crisis in the form of devastating wildfires and destructive post fire flooding that impact residents long after the fires themselves have been suppressed. We applaud the Flagstaff City Council for declaring a climate emergency and for developing the Flagstaff Carbon Neutrality Plan. We believe our request is consistent with these commitments.

You might not think twice about who the city banks with, but as the Banking on Climate Chaos Report 2022 reveals, Wells Fargo is among the world’s top funders of the fossil fuel industry. Its lending and underwriting pay for the day-to-day operations and disastrous expansions of the global fossil fuel industry. In practical terms, this means that the city council has committed the public’s money — our taxes — to financing the industry that is causing the climate catastrophes right here in our community. Needless to say, this is completely contrary to the city’s commitment to action in the face of a climate emergency.

In its most recent report, the UN Intergovernmental Panel on Climate Change said that carbon emissions must be cut in half by 2030 to preserve the chance of a livable future. Yet, as the UN Secretary General Antonio Guterres said, “[w]e seem trapped in a world where fossil fuel producers and financiers have humanity by the throat.” Amidst this bleak outlook, as an explosive investigation by The Guardian revealed, the world’s largest fossil fuel companies are planning 195 new so-called “carbon bombs,” gigantic oil and gas expansion projects that will, without doubt, trigger catastrophic climate breakdown.

Who is financing this madness? The answer is global banks, the four largest of which are US-based: JP Morgan Chase, Citi, Wells Fargo, and Bank of America. In the first six years after the 2015 Paris Agreement when the nations of the earth agreed to carbon reductions to keep warming below 1.5 degrees Celsius, 60 of the world’s largest banks invested $4.6 trillion in fossil fuel companies. And Wells Fargo actually increased its fossil fuel financing in 2021 by $42.2 billion.

We believe this alone offers overwhelming grounds for the city council to direct staff to put out a request for proposals for a new servicing bank. Additionally, surely Wells Fargo’s repeated illegal, immoral and unethical banking practices also constitute grounds for taking this action. For decades, Wells Fargo has paid fines for a host of infractions including fraud, discriminatory mortgage abuses, banking abuses, toxic securities abuses, and investor protection violations. Since 2000, the bank has paid over $25 billion in penalties.

Egregious cases where Wells Fargo preyed upon its customers include: 1) In July 2013, the bank settled with the Department of Justice, paying $175 million for engaging in a pattern of discrimination against qualified African-American and Hispanic borrowers, including steering them into subprime predatory mortgages. The case was the second largest fair lending settlement in the department’s history; 2) In February 2020, the bank paid $3 billion to resolve criminal and civil investigations into sales practices involving the opening of millions of unauthorized customer accounts, admitting that it collected millions of dollars in fees and interest to which it was not entitled, harmed the credit ratings of customers, and unlawfully misused customers’ personal information; and 3) In December 2022, the Consumer Financial Protection Bureau ordered Wells Fargo to pay $2 billion in redress to consumers and a $1.7 billion civil penalty for legal violations across several of its largest product lines. The bank’s illegal conduct caused billions of dollars in financial harm to its customers with thousands losing their vehicles and homes.

Now is the time for the Flagstaff City Council to chart a new course and not renew the contract with Wells Fargo, and instead direct staff to put out a request for proposals for a servicing bank. This will enable them to determine if they can contract with a financial institution that doesn’t repeatedly engage in illegal, discriminatory and unethical behavior, and doesn’t use the public’s money to fund the climate emergency.