As more information becomes transparent it has become clear that Wells Fargo corporate leadership and management cultivated a culture of fraud. This was not some simple off the cuff creation maverick employees it was a strategically process which developed a sales pressure that lead to a culture of fraud. This trickles down as a pathway to financial victimization of unwitting customers of the bank.
The pubic relies on the good intentions and conduct of the banking industry. At the core of this relationship is the concept of fiduciary responsibility. That fiduciary responsibility states that the fiduciary will take the best interest o the client in all transactions. This is fully defied with the cross selling pressure exerted on employees. I am not condemning cross-selling as this many times is providing customers with important services, yet the pressure of quota’s and sales incentives muddies the waters of fiduciary responsibility. Making a customer aware of additional offers is good business, pressuring sales results is not.
Shah Gilani of Capital Wave Strategist wrote the following:
Wells Fargo has long prided itself in its ability to cross-sell its customers different banking and financial services. Customers with multiple accounts and services are considered “sticky” customers who aren’t inclined to leave the bank.
The company reports that its customers use an average of 6.15 services, the highest in the industry.
Cross-selling isn’t just a way to keep customers, it’s a way to make more money – a lot more – out of each customer. In fact, cross-selling really shines out in Wells’ financial and proxy statements.
It shines out so much that cross-selling bonuses and commissions account for between 3% and 15% of sales associates’ salaries. The practice is so important to Wells that many employees reported being fearful of losing their jobs should they miss sales goals.
A Los Angeles Times investigation, published in a Dec. 21, 2013, article by E. Scott Reckard, titled “Wells Fargo’s Pressure-Cooker Sales Culture Comes at a Cost,” lays bare aggressive tactics pushing banker sales teams to cross-sell products like checking and savings accounts, overdraft protection, credit cards, mortgages, and wealth-management products to existing customers.
In the article, Reckard writes, “The relentless pressure to sell has battered employee morale and led to ethical breaches, customer complaints, and labor lawsuits.”
Employees reported being forced to work after-hours and weekends to make up missed quotas. The Times reports one branch manager was constantly told she’d “end up working for McDonald’s” during hourly browbeatings masquerading as “conference calls.”
And now we know that 5,300 “team members,” bankers, and branch managers who allegedly set up bogus accounts for customers who never authorized them, to rip customers off and pad their own salaries and bonus payments (and perhaps save their jobs or have a weekend off once in a while), all over the past five years, and all in offices across the country.
Five years. Across the country.
This wasn’t someone’s fly-by-night quick get-over, get-rich scheme.
Now, three-and-half years after the Los Angeles Times‘ investigation, we know 2 million unauthorized accounts were opened by employees who simply made up addresses – physical and email – so statements wouldn’t go to those customers. They made up telephone numbers, stole customer data, and forged signatures to open new product accounts.
In a statement last week, Oscar Suris, Wells’ head of corporate communications, said upon analyzing 93 million accounts it was discovered, though it was unclear, that roughly 2 million accounts may not have been properly authorized. Of those roughly 2 million accounts, 1.5 million were deposit accounts and 565,000 were credit card accounts.
Worse, 115,000 had fees associated with them. I guess management never thought to look a revenue stream in the mouth.
YOU must realize that financial victimization is the most pressing financial threat and risk any of us face on a daily basis. This is totally ignored until he headlines bring it into focus. Don’t let this warning go unnoticed. As a member of the Advocacy Network you will be taking proactive action to protect you and your loved ones against all forms of financial victimization. The risk is not going to be mitigated through any other strategy or action. The proof that you are nothing more then a number is validated in this incident with one of the largest and most successful banks in the nation. Wells Fargo has been fined $185M to date. That is spending change for the institution. They fired 5300 employees and allowed the Chief corporate officer to walk away with $125M in compensation. It is he culture of zero accountability that has promulgated the environment of financial victimization. Sadly corporate cultures are pressuring and then rewarding employees for producing financial victims. Its not going away and the only one who can be fully accountable for your protection against scams, fraud and predatory sales tactics is YOU. The Advocacy Network will fully protect you against all forms of financial victimization.
YOUR Best Interest Is OUR Only Concern!