They are ignoring warning signs while misplacing their trust in regulators and authorities. They shouldn’t.

If you deal with crooked people, you should expect to get screwed – sooner or later. Even if the crooks are people you never meet or interact with in a large multi-national bank.

Here is the story of two companies which illustrate why everyone must look after themselves by being selective about who they trust in business. And why nobody should trust regulators or government to protect them from the cheaters.

The first is Wells Fargo – a "Global Systemically Important Bank." The bank has Warren Buffet as a major stakeholder and lavishes Washington DC politicians and bureaucrats with political contributions and lucrative job opportunities. It is considered "too big to fail."

Wells Fargo clients who take comfort in that status are missing the more important "flip side" of the bank’s size and political connections. The bank’s executives may also be too big to jail. Wells Fargo, like other major banks, is being granted a sort of license to cheat based on its size and status.

As a result, the bank has built a rap sheet a mile long over the past 10 years. The bank has been caught opening phony accounts, adding services (and fees) clients didn’t request, rigging bond markets, abusing foreclosure rules, and a lot more. Millions of their clients appear to have been cheated and scammed.

All the while, we are not aware of any senior executive that has been prosecuted. The bank’s shareholders, not the executives directly responsible, pay the fines.