aside Wells Fargo’s Management Had Ample Prior Notice Of Cross Selling Problem Practices

banks-forbes-stumpfcover2012I am writing this blog to dispel any public relations talking points by the Wells Fargo CEO, John Stumpf, along the lines that he is taking full responsibility for the scandal by which employees opened new customer bank accounts on a wide spread basis without the clients’ prior knowledge or approval. There is the attempt for the management to look as if they are taking corrective steps by the firing of numerous employees caught in the practice of these fraudulent activities. The problem is that this has been their modus operandi  for years. Their acting before the 9/ 20/16 U.S. congressional hearings was a total sham. I can prove this by demonstrating their pattern of dealing with scandal by the following 2013 report.

The Source of the following material is from: The 12/23/2013 Consumerist blog by Chris Morran:

“A few months back, we told you about the 30 Los Angeles-area Wells Fargo employees who became former Wells Fargo employees when it was discovered they were opening bogus accounts to meet the bank’s demanding sales goals. According to a new investigative report on the megabank, Wells workers around the country are feeling pressured into behaving unethically just to avoid being fired.”

bank-wells-fargo-grat-photo-davidson-the-record-fine-against-wells-fargo-1200x630-1473711788“We were constantly told we would end up working for McDonald’s,” one former branch manager from Florida tells the L.A. Times. “If we did not make the sales quotas … we had to stay for what felt like after-school detention, or report to a call session on Saturdays.”

“She says she resigned in 2010 rather than deal with the required hourly sales updates from regional managers, and the dangling threat of termination for those employees who failed to meet quotas.”

“Wells Fargo averages more than 6 financial products per household — several times the national average (3) — but even that isn’t enough, with bank brass reportedly urging employees to shoot for the “Great 8,” meaning that each household would have bank accounts, credit cards, loans, and just about anything else you could get from a Wells Fargo branch.”

Sen. Elizabeth Warren questions John Stumpf, chairman and CEO of Wells Fargo, about the unauthorized opening of customer accounts by Wells Fargo during a Senate Banking Committee hearing Tuesday. Saul Loeb/AFP/Getty Images
Sen. Elizabeth Warren questions John Stumpf, chairman and CEO of Wells Fargo, about the unauthorized opening of customer accounts by Wells Fargo during a Senate Banking Committee hearing Tuesday.
Saul Loeb/AFP/Getty Images

“To some, that pressure and the dread of losing their jobs led them to make bad, and sometimes illegal decisions. In addition to opening up duplicate accounts, one of the 30 Wells employees dismissed in October tells the Times that people at the bank used a company database to identify customers to pre-order credit cards for customers who had been pre-approved.

“They’d just tell the customers: ‘You’re getting a credit card,’” explains the former employee, who said that when customers would complain about the unasked-for cards, a manager would just chalk it up to a computer glitch.”

bank-best-cross-selling-cartoon-girl-scouts-disruptive_brand_extensions-565x406“Another former branch manager tells the Times she learned that some of her employees had talked a homeless woman into opening six different accounts, all just to meet quotas, when the woman only needed a single account in order to get her Social Security benefits direct-deposited.”

“It’s all manipulation. We are taught exactly how to sell multiple accounts,” says the former manager, who helped the customer close all her unnecessary accounts. “It sounds good, but in reality it doesn’t benefit most customers.”

“About the pressure from Wells HQ, she adds, “If you do not make your goal, you are severely chastised and embarrassed in front of 60-plus managers in your area by the community banking president.”

bank-cross-selling-cartoon-77e3c52d5ab3b8887ceec31431970a11“For its part, Wells maintains that it does have a focus on selling products to customers but disagrees with the notion of a boiler-room sales culture.

“This is something we take very seriously,” a rep for the bank tells the Times. “When we find lapses, we do something about it, including firing people.”

“He also points out that most employees receive relatively little of their pay from bonuses, with only around 3% of tellers’ annual pay tied to sales goals.”

“But that may be a short-sighted viewpoint, as it assumes that these bad employees are behaving unethically out of greed.”

“If I work at a store and my boss tells me I need to sell $500 worth of widgets each day or I’m fired, it makes no difference to me whether I earn commission on those widgets. By telling an employee that his or her job is on the line, a boss is letting it be known that 100% of that employee’s wages are on the line, not just the small percentage tied to sales goals.”

4685506790_894e901cd0-good-call-center-cartoonThe following are excerpts from a blog I posted on 2/10/15, NUTTY CONSUMER’S 7TH RANT AGAINST “COOKIE CUTTER” CALL CENTERS:

How could agents not suffer some anguish if they felt required to compromise their moral values in order to keep their job?  How would  anyone not be uncomfortable by finding themselves being placed in a position as at Wells Fargo by which you are directed to sell hard on each and every incoming call no matter what the customers’ circumstances.

You could ask why doesn’t the agent protest to management. As one agent advised me, it is management who are enforcing these standards. If you are perceived as not being a team member, your life will be made very unpleasant. You will be  marginalized with a reputation for being a difficult or disgruntled employee; someone who is unstable as well as not being a team player.

call-center-cartoon-100-aht-aht-cartoonAn agent from a well established company described to me what typically occurs when an employee dares to challenge the status quo. The offending agent could be subject to excessive monitoring with supervisors listening in at random and excessive surveillance. As time passes the agent will experience extreme discomfort and will eventually leave…(told by an employee)… She had been subject for weeks to a frequently deployed tactic by call center management of excessive surveillance and constant monitoring. This includes the supervisors listening and recording many calls for hours and at random times with the intent to catch the employee making an error. Then the employee is frequently confronted with all their errors, written notices, increased coaching sessions  with the employee’s  full knowledge that they are helpless, and even if they get that they are being treated unfairly and unjustly, they have no legitimate, reliable and effective recourse for relief. This is just for starters!

call-center-comic-58-thumbThese tactics  are also used to set up an employee to be fired.  If companies believe that this pattern of subjecting offending employees to these bullying and mental harassment tactics  designed to separate out an agent, is a way to avoid legal repercussions, please reconsider this stance.  Currently, these systemic practices  may not be sufficient for claimants to legally prevail on the basis of the companies’ managers, intentionally “inflicting extreme emotional distress” on any particular  employee.  However, as per an article in the Insurance Journal, published 3/4/2013, titled “Workplace Bullying Emerging As Major Employment Liability Battleground “by Sam Hananel, “more than a dozen states — including New York and Massachusetts — have considered anti-bullying laws in the past year that would allow litigants to pursue lost wages, benefits and medical expenses and compel employers to prevent an “abusive work place.”  


    • Dear Jueseppi, GRAZIE MILLE!! I hope that Mr. Stumpf gets his just desserts. It would be great if the fired employees filed a class action suit. As always, I am grateful for all of your support and thanks a million for this reblo. Ciao Bello, Gronda


  1. Great post. It is interesting how this bank and its predecessors have examples of bad management decisions, where the people punished are the workers. The same could be said for other large banks like Bank of America, Citibank and some that do not exist anymore.

    Companies take on the personality of its leaders. Wells has been known for cross-selling as long as I can remember. I do not accept that leaders in this company were unaware of what was going on, as there is a roll up affect of numbers – regional managers have cumulative sales goals of their units as well. But, I do know a company’s reputation is more important than short term gains.

    Wells bought, on the cheap, Wachovia whose actions preceding the financial crisis almost closed their doors. They had a run on the bank. Two of those actions are important to note. Wachovia bought Golden West which had an artificially high value due to the sale of a variable payment mortgage product called “pick-a-pay” mortgage which was designed for a very astute lendee. Yet, it was sold to the masses as the future, even to folks that could only “fog a mirror” but were very poor credit risk.

    Wachovia comes along and pays a premium to buy Golden West. Then, the second mistake occurs. They promote selling more pick-a-pay mortgages even having promotional parties for its staff. So, they sold even more of this very risky product driving their downside risk to greater magnitude. Mortgage employees were questioning amongst themselves, why are we pushing this, but leaders said push it.

    These decisions crumbled Wachovia. Yet, when mergers occur, guess who gets let go? The many employees are let go to so that the merger can be accretive to earnings. The leaders that caused this walk away with severance packages. This is financially akin to Roger Ailes walking away from Fox with $40 million after sexually harassing a number of women and creating a culture of harassment.

    Sorry for the digression. The Wells Fargo Board needs to act on its CEO. The buck does stop there.


    • Keith, As always I appreciate all the extra information you provide for context. Wachovia and Wells Fargo are not the only companies going for the quick higher profits to where their brand is compromised.

      I look for major clues like,. First, higher employee turnover rate than their competitors; the employees do not feel safe to report questionable activates to management without the fear of being marginalized or worse; and the decrease of customer satisfaction in customer surveys.. This type of company is dysfunctional to where it needs a culture overhaul.

      One action that company boards can take, is cutting back on bonuses etc. from these short sighted top level managers.

      Ciao, Gronda


      • These are excellent signals. In my consulting, I have seen very well run companies and some where greed and cutting corners is the norm. I invested in one company this year not only because they had a high dividend and a good P/E ratio, but they were rated one of the most admired companies to work for.


        • Great news about the traffic. Did you get more likes and comments or were they just stopping by for a visit. I was sharing with Rob Goldstein that Trump is now ahead in one of Nate Silver’s polls and close in the other two. This is getting very scary. We need the millennials to look past the caricature and at HRC’s career and also pay attention to the climate change issue as Trump thinks it is a hoax.


        • Dear Keith, Yes this is nerve racking. I can’t believe that HRC is almost tied with the likes of of DT, a chronic liar as per PolitiFact. The Millennials are oblivious to the feminist movement during the 1970s and 1980s or the history of how Mrs. Clinton has been virtually stalked by the far right for over 30 years with contrived stories and investigations in order to define her as being untrustworthy and a liar who should be locked up.

          You were right about her and her surrogates needing to publicly emphasize her plans for climate change as this is an issue important to young folks; and she should have surrogates like Mrs. Obama talk about the culture when Mrs. Clinton stepped out on the political stage.

          I am so nervous about tonight’s debate that I’ll probably not watch it in real time. Ciao, Gronda

          P.S. WordPress did forward the message about increased traffic and I have one new person commenting. Thank you so much for your kindness and generosity, Gronda


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