Wells Fargo fired 5,300 employees for creating over two million bank accounts that customers never asked for in order to carry out corporate sales policy. Wells Fargo is paying a $185-million fine for this strategy to improve stock value.
Not losing his job or his $200 million-plus in stock gains is Wells Fargo CEO John Stumpf… although Senator Elizabeth Warren thinks he should. Here’s what Senator Warren said to Stumpf yesterday before the Senate Committee on Banking, Housing, and Urban Affairs:
Here’s what really gets me about this, Mr. Stumpf. If one of your tellers took a handful of $20 bills out of the crash drawer, they’d probably be looking at criminal charges for theft. They could end up in prison.
But you squeezed your employees to the breaking point so they would cheat customers and you could drive up the value of your stock and put hundreds of millions of dollars in your own pocket.
And when it all blew up, you kept your job, you kept your multi-multimillion-dollar bonuses, and you went on television to blame thousands of $12-an-hour employees who were just trying to meet cross-sell quotas that made you rich.
This is about accountability. You should resign. You should give back the money that you took while this scam was going on, and you should be criminally investigated by both the Department of Justice and the Securities and Exchange Commission. This just isn’t right [Senator Elizabeth Warren, in “‘You Should Resign’: Watch Sen. Elizabeth Warren Grill Wells Fargo CEO John Stumpf,” NPR, 2016.09.20].
Marketplace yesterday featured Jim Griebel of Valley Springs, whose daughter was one of the employees Wells Fargo pressured to push unnecessary accounts and who himself got tricked into taking more accounts:
Jim Griebel of Valley Springs, South Dakota said his daughter had an entry-level teller position at Wells Fargo a long time ago, and he remembers there was a lot of pressure, and even shaming, to get employees to cross-sell products and meet quotas.
“One of the biggest problems was angry customers, because they were getting badgered time and time again to sign up for these cards,” he said. His daughter quit after less than a year.
But more recently, Griebel became a Wells Fargo customer himself, with multiple accounts — and then something strange happened.
“About two years ago we got a call from a Wells Fargo employee,” he said. The employee told his wife that they needed to attach a debit card to several deposit accounts; it was presented as a requirement, not a choice. His wife agreed to it, but he didn’t want debit cards, so he called a manager. It was at that point he learned that his wife had been lied to. There was no requirement to get a debit card.
“I don’t know if I would call it illegal, but it was certainly unethical,” he said [Lewis Wallace, “Wells Fargo in the Hot Seat with Senate Banking Committee over False Accounts,” Marketplace, 2016.09.20].
An outcome of offering customers the products and services they need, want, and value is that we earn more opportunities to serve customers, or what we call cross-sell. Cross-sell is the result of serving our customers extraordinarily well, understanding their financial needs and goals over their lifetimes, and ensuring we innovate our products, services, and channels so that we earn more of their business and help them succeed financially. We succeed when our customers succeed [Wells Fargo, “Our Strategy,” downloaded 2016.09.21].
When you walk into Wells Fargo, the tellers will apparently continue to ask intrusive, personal questions, not because they are personally curious, but because they are ordered to “expand the relationship” by finding out details that can hook into selling you more products and boosting CEO Stumpf’s stock value.