The Economist: Limitless Bank Regulation

America’s financial system: Law and disorder:

The upshot is a deluge of paperwork. If banks once did banking, now they practise law. Wells Fargo has lower legal costs than many of its rivals (see chart) but still receives around 300 state, federal and grand-jury subpoenas a week on average. Some are against the bank itself, though many are legal orders pertaining to the suspected crimes of others. The bank gets so many legal orders—5,000 a week in total—that it has two centres that work full-time on processing them, one on the west coast, one on the east. A specific group works on prioritising the bank’s response to subpoenas; a weekly call involving 25-30 of the more senior people in the compliance division is designed to iron out problems that arise from all these requests.

Guess who pays the bill. Different isn’t always better. More isn’t always better. This isn’t better.


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