The arrogance of Wells Fargo was apparent when it announced earlier this month that it would phase out a questionable “sales goals” program in Jan. 2017. Those sales goals created the incentive for 5,300 Wells Fargo employees (since fired for ethical violations) to create some 2 million fraudulent customer bank accounts. The bank announced Wednesday that it will discontinue the sales goals by the end of the week. Meanwhile, eEx-Wells Fargo employees filed a class action lawsuit seeking $2.6 billion in damages. Finally, on Oct. 12, 2016, John Stumpf abruptly “retired.” Stumpf reportedly did not get any severance but will retain more than $100 million in vested stock, plus accumulated pension and 401(k) benefits exceeding $24 million – Ed.
A few years ago, I opened an account at a local branch of Wells Fargo Bank for a limited purpose. Once that purpose was accomplished, I intended to immediately close the account.
A young bank officer who facilitated the transaction persuaded me to keep the account open. He assured me that he had set up my account in such a way that I would never lose the account balance of $100 deposit through the churning of bank fees.
Of course, in less than a year, all the money was gone, usurped by Wells Fargo in bank fees. Meanwhile, I was assaulted with notices, offers and credit card applications. One paper in this mountain of paperwork may have contained an obtuse notice that my account was being transferred to a different charge-bearing vehicle. I complained to the bank, which said it was my fault, and then I put the matter behind me, chalking it up to yet another example of pervasive and persistent financial fraud in America.
So this week, it was with interest that I read about the Wells Fargo’s practice of using unrealistic sales goals to pressure employees to set up phony accounts and cheat customers. The bank has fired 5,300 employees for ethical violations and announced it would eliminate all product sales goals in retail banking, effective January 1, 2017.
Remember the financial crisis of 2007, which propelled the world into a deep recession, from which many will never recover? How much of the Wall Street meltdown was due to unethical practices promulgated by massive financial institutions ( like Wells Fargo) which required workers to lie, cheat, and steal in order to remain on the payroll?
Why is John Stumpf, Chairman and CEO of Wells Fargo, still working there?
Senior management of Wells Fargo is responsible for the fraud on its customers, not the underlings with families to feed in an unforgiving economy. The bank employees who were fired for ethical violations are culpable and shouldn’t be working in a position of trust. But Wells Fargo created the incentive for the unethical behavior of its employees by adopting unrealistic sales goals to increase profits year after year. Indeed, Wells Fargo plans to continue enforcing these “product sales goals” until January 2017.
If America permits the senior management of Wells Fargo to scapegoat its own employees and avoid responsibility for financial fraud, aren’t we inviting another financial meltdown? Haven’t we learned anything?
Wells Fargo CEO John Stump needs to go. IMMEDIATELY!
The bank has been fined $100 million by the U.S. Consumer Finance Protection Bureau and ordered to pay back consumers harmed by its actions.
Wells Fargo & Company, headquartered in San Francisco, is one of the nation’s biggest banks. It has $1.9 trillion in assets and, according to the company, serves one in three households in the United States. Wells Fargo & Company was ranked No. 27 on Fortune’s 2016 rankings of America’s largest corporations.