The Philadelphia office of Action United, an activist group that's a successor to the former ACORN, says it's going to recruit protesters from the Occupy Philadelphia tent village that has grown up in Dilworth Plaza west of City Hall, for a march two blocks south to Wells Fargo's local office at 123 South Broad St. tomorrow afternoon to demand Wells Fargo return "its share" of more than $63 million the Philadelphia School District had to pay banks to settle interest-rate swap contracts last year.
The swaps were supposed to protect taxpayers from rising interest rates, but ended up costing millions when US interest rates fell and stayed low. The School District says the cost was partly offset by cheaper bond issuing prices, a claim that's been questioned by state Auditor General Jack Wagner.
Asked why his group was protesting Wells Fargo but not the New York banks that arranged a majority of the swaps, Action United boss Craig Robins gave me two reasons: First, Wells is a major US mortgage lender and has "done a lot of foreclosures" (95% of its Philly borrowers are current, more than in other markets, the bank says). Also, "one of their people is a member of the School Reform Commission" that controls Philadelphia schools. Denise Armbrister is chairman of the Wells Fargo Foundation.
NEW: Wells Fargo spokeswoman Barbara Nate said the bank "find(s) it valuable to listen to what our stakeholders have to say. We recognize Americans are demanding more from their financial institutions during these difficult economic times. Wells Fargo is committed to serving the financial needs of businesses and individuals, keeping credit flowing, and working to help those in financial distress find solutions."
EARLIER: To Robins and his group, it's a potential conflict of interest for the executive of a bank that does business with the schools to be setting school policy. "We think they should pay back their fair share," he told me, admitting he didn't know how much that would be. Wells Fargo officials didn't immediately return calls.
School commissioners recuse themselves from voting on issues where there's a potential conflict of interest, said schools spokesman Fernando Gallard.
Robins says his group will mobilize at least 40 members for the protest, which would be more than predecessor ACORN typically brought to its past Philadelphia events. Plus "we'll see how many of the Occupy folks join."