Wells Fargo Accounts Fraud Scandals: Risk Assessment and Governance

Running Head: Wells Fargo accounts fraud Scandals
WELLS FARGO ACCOUNTS FRAUD SCANDAL
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Wells Fargo accounts fraud scandals1
Executive summary
The corporate management of risk indicates the procedures that are applied by the corporation to
eliminate economic loss. The executives, risk managers, middle managers and line managers
along with the employees conduct the practice in order to prevent the exposure of financial loss
by the internal controlling over the technologies and individuals. Thus risk management denotes
the external threat to the company as the variation in an economic market that hamper the
monetary assets.

Wells Fargo accounts fraud scandals2
Table of Contents
Introduction......................................................................................................................................3
Assessment of risk...........................................................................................................................4
Key risk........................................................................................................................................4
Key causes for fraud scandal.......................................................................................................4
Risk classification........................................................................................................................5
Risk response...............................................................................................................................5
Shortfall in approach of Wells Fargo...........................................................................................6
Aspects of risk governance..........................................................................................................7
Conclusion.......................................................................................................................................8
References......................................................................................................................................10

Wells Fargo accounts fraud scandals3
Introduction
The Well Fargo is accountable for fraud scandal is continuing controversial issues which
is brought by the formation of millions of checking accounts and fraudulent savings on behalf of
the clients of Well Fargo without obtaining permission of them (Schaltegger, Burritt and
Petersen 2017). The fraud news widely spread in the later 2016 after the governing structures
which involve The consumer Financial Bureau of Protection in the United Kingdom charged
around US$185 million from the company as the consequence of the unlawful act (Hopkin
2018). The company in addition to the fines also faces litigation that bought against then in
criminal and civil suits which comes around $2.7 billion at the end of the year 2018 (Kostry et al.
2017). The clients of Wells Fargo notice that the fraudulent act of the company after being held
responsible goe alleging unanticipated charges and also obtain debit cards or unexpected credit
or credit lines. The initial report raise blame towards the managers and workers of the Well
Fargo for the issue along with that sales incentive that re-linked with the solutions of selling
multiple or financial goods (Cavico and Mujtaba 2017). Later on, the blame was transferred to
the pressure of top-down from the management of higher-level to open up accounts through the
process of cross-selling. The few risks hold by the bank inclined to economic crisis from the
period of 2007-2008 that resulted in stability image in the financial world and also on Wall Street
(Jiang and Shen 2017). The reputation of stability in the financial institution was discolored by
the fraudulent activity that is widely spread and the subsequent coverage that is engaged by the
corporation (Witman 2019). The controversial issue that had been raised leads to the resignation
of CEO name Johnf Stump. Furthermore, the inquiry held in the bank was led by Senator of
United States along with that presidential election in the year 2020 of the candidate named