Wells Fargo Account Scandal: A Comprehensive Analysis

Desklib provides solved assignments and past papers to help students succeed.

WELLS FARGO ACCOUNT SCANDAL
1

Contents
Introduction............................................................................................................................................3
Brief History of the Wells Fargo Scandal............................................................................................4
The organisational culture at Fargo, and organisational Competitiveness......................................4
Conclusion..............................................................................................................................................6
References...............................................................................................................................................7
2

Introduction
Wells Fargo is the multinational company which mainly deals in the financial services, the
headquarters of the Wells Fargo is situated in San Francisco, California and the also some
central offices in the United States. The Wells Fargo is the 4th largest bank in the US. This
report is introducing the scandal of Wells Fargo for 2 years back when this organisation tries
to achieve some target by during some fraud which is to be discussed in the main part.
3

Brief History of the Wells Fargo Scandal
In the year 2016 Wells Fargo was involved in the scandal which is one of the biggest
scandals in the past. The beginning of this scandal is from the sales which Wells Fargo have
to hit that sales target. It is also exposed that the staff who is working in the Wells Fargo had
created the fake bank accounts in millions in demand for achieving the target. Regardless of
the big fines a senatorial criticism and the confessions in the public, the employees to this
166-year-old bank appealed that there has little change. Megan Halvorson is the private
employee of the Wells Fargo from six years has told that it not seen as they have something
big. And when the Wells Fargo scandal has been broken then the organisation had paid
approximately $1.7 billion in fines and $575 million for if they are late as December
(Veetikazhi, et. al., 2018). The executives of the Wells Fargo has been roasted by association
and also they have promised for the new day. Many of the employees felt that they are the
victim at the time of the fraud done on the accounting scandal. And they are still abused as
Megan Halvorson said. Halvorson said that some of the employees are in a deep pressure due
to the middle management for getting their bonuses. In the month of December 2017, the
organisation has announced that they planned to increase their base wages to $15 for an hour
as they consider the scandal and also take the decision of reconsideration of the bonuses
because it is the leading problem in an organisation. Before the rise, Wells Fargo had
announced to cut their workforce which is about 265,000 employees by 5% to 10%. And they
are sent hundreds of bank loan and the jobs in call centers. By this decision, the employees
are aggressively told for increasing the minimum wage to $20 for an hour and as well Wells
Fargo endures to post for the profit of multibillions. When the tax cut has passed the Wells
Fargo had saved the estimated amount of $3.7 billion yearly and the stock buybacks of $40.6
billion (Smith & Reiners, 2017). The Ross and Halvorson are between those several
employees of the Wells Fargo which are organising the CBB (Committee for the Better
Banks). The Committee for Better Banks of Wells Fargo is the one who supports for
exposing the Scandal in a few years in the past.
The organisational culture at Fargo, and organisational Competitiveness
Wells Fargo has paid many years for apologising for the misleading customers with the bank
accounts which are fake and also the unwanted products, the executives said that they have
removed the destructive sales objectives that show their bad behaviour and the culture of the
bank has been changed. There are no indications that the employees of Wells Fargo are
opened the accounts in the name of the customer's. The Employees of the Wells Fargo said
that they have remained in the pressure for taking extra money out of the customer's account.
The survey is conducted for more than 27,000 employees for the information technology
department of the bank with the top distresses that the Wells Fargo manners for the business
actions with truthfulness and uprightness (Wang, 2018). By watching this the employees of
Wells Fargo recently commented to the internal blog of the banks with aggressive comments
that is about Wells Fargo incentives regarding the sales. Many of the employees in the Wells
Fargo may not think of the behaviour after an ethics viewpoint, they simply try to do what
they are told irrespective of the company ethics and guidance. These type of workers are
rewarded by the managers for achieving the sales targets. This ethical culture type is very
tough to change without the active leadership.
4

Wells Fargo has provides the complete collection of the banking services, and it is strongest
in the bank loan and also shows the example of best leadership in this particular area. The
Wells Fargo always remains far forward from its competitors JP Morgan Chase and the Bank
of America (Ochs, 2016).
5

Conclusion
The Wells Fargo is the multinational company which mainly deals in the financial and
banking services. Some few years back this company comes in the scandal where the
employees of this bank make the fake account of the customers in the subject to achieve their
goals. The organisational Culture and its competitiveness are to be discussed in this report.
6

References
 Ochs, S.M., 2016. The leadership blind spots at Wells Fargo. Harvard Business
Review, 10.
 Smith Jr, J.A. and Reiners, L., 2017. Wells Fargo Unauthorized Account
Openings: A Case Study for Bank Board Directors.
 Veetikazhi, R. and Krishnan, G., 2018. Wells Fargo: Fall from Great to Miserable:
A Case Study on Corporate Governance Failures. South Asian Journal of Business
and Management Cases, p.2277977918803476.
 Wang, Y., 2018. The Relationship Between Risk and Performance in Bank Wells
Fargo Bank. Available at SSRN 3302064.
7