Wells Fargo Essay

Knowledge is considered as one of the most important and competitive resource for sustenance of the organisation (Zack, 1999). It can be compared to the strategic resource that can be used and applied in various frames of the organisation. Experienced managers in the organisations believe that company can receive strategic advantage through knowledge and not the strategies or actions implemented by competitors. Knowledge can be regarded as a strong approach that opens numerous ways of success. It is that weapon that help organisation to evaluate solutions in financial and other professional difficulties.

In California, eight Wells Fargo employees were convicted of committing fraud facing a maximum penalty of 30 years in federal prison, also each employee is charged with at least one count of aggravated identity theft, which carries another two years in prison (https://www.justice.gov/usao-cdca/pr/eight-people-charged-bank-fraud-scheme-allegedly-used-information-stolen-wells-fargo). In the wake of the scandal, over 5,300 employees were fired over the course of five years for their involvements in the creation of the fake accounts. Some of the initial whistleblowers of the scandal faced retaliation by being terminated for speaking out against the orders to open fake accounts. CNN Money correspondent Matt Egan spoke with Bill Bado, a former employee of Wells Fargo, who has not been able to security another banking securities job since his termination for calling the Ethics Hotline to report the fraudulent activities.

Wells Fargo fired 5300 employees. The employees took millions in fees by regularly opening new

The article,”To Disclose or Not to Disclose? Wells Fargo Woes Shine Light on a Knotty Problem

The Sarbanes-Oxley Act of 2002 was put in place to prevent corporations from committing accounting fraud or corruption. When a corporation manages somehow to get passed all the laws they do anything to keep the corruption going by covering up everything. With this going on the company’s main focus is keep the lies going and firing whoever is in the way. Wells Fargo has stated that they have fire over a hundred thousand people throughout the nation for being a part of the illegal activity in the company. Unfortunately for Wells Fargo employees are coming out from hiding telling their side of the story.

Bank of America is one of the largest banks in the nation. It is a multinational company and it is recognized by its high revenue value. Unfortunately, Bank of America has endured many complaints and harsh views regarding their lack of ethics. Ethical issues occur when there is a blatant disregard to implement integrity, trust, and responsibility. In some financial institutions, ethical matters are displayed in the way the consumers are treated. Within the past nine years, Bank of America has diminished all of their ethical promises by revealing customer information without their permission; discriminating against consumers based on their race; and manipulating overdraft fees in order to benefit the bank. In order to assess these problems, it is vital to recognize what Bank of America claims to stand for and determine where their most concerning issues are generated from.

On September 8 2016, the Consumer Financial Protection Bureau (CFBP) announced that it was taking an enforcement action against Wells Fargo Bank . Wells Fargo is a Fortune 100 company and one of the "Big Four Banks" of the United States. Investigations conducted by the Bureau revealed that employees of the bank created unauthorized deposit and credit card accounts across the country to meet sales goals. Over the years, the bank’s employees opened over 1.5 million fraudulent bank accounts and 0.5 million fake credit card accounts for customers, to meet sales targets and obtain bonuses. The affected consumers, were being harmed by the associated charges and fees for these accounts. The fees include insufficient funds or overdraft fees for the deposit accounts and annual fees for credit card accounts.

In 2016, federal regulators caught Wells Fargo creating millions of fake bank and credit card accounts; over 1.5 million bank accounts were created. Furthermore, federal regulators also said that 565,443 credit cards were created, and 1400 of those accounts had been charged over 400,000 dollars in fees. Wells Fargo employees broke many ethical and legal boundaries and engaged in counterproductive work behavior.

On September 8th, Wells Fargo’s misconduct was exposed when the Los Angeles City Attorney, the Consumer Financial Protection Bureau (CFPB), and the Office of the Comptroller of the Currency (OCC) fined the bank $185 million, alleging that more than 2 million bank accounts and credit cards were opened or applied for without customers' knowledge or permission between May 2011 and July 2015. In response, Wells Fargo fired 5,300 employees and, in an official statement, expressed their regret over the actions those employees had taken in regards to their customers. Wells Fargo also announced that it would be ending its controversial employee sales goals program. Wells Fargo’s employees sales goals program was an incentive-driven compensation program where employees earned financial awards based on the number of financial products they could sell, all under the pressure of satisfying exorbitant sales goals set by the upper management at Wells Fargo.

Until the intent or motive is recognized, a problem cannot be described or solved. This should be a major question to ask in the Wells Fargo case. Most workers, especially in sales and marketing jobs are known to be compensated and promoted based on their performances (number of products and services sold, number of set targets met). So it is possible that Wells Fargo compensation and promotion structure motivated these employees to engage in such fraudulent acts in order to boost their incentives and bonuses which was measured based on their performance. Because it is surprising that such huge number of employees would engage in such acts to cheat customers for a period of five years. Both former and current Wells Fargo employees told regulators that their motivation to open unauthorized accounts was because of the compensation policies and felt extreme pressure to do that to benefit from such policies (Corkery

The ethics of the bank requires that there is ethics of integrity. It is supposed to be created through a culture in the bank and it should be one of the banks priorities because this is a business and they gain the profits from the people they serve on daily basis. Even if the bank shall survive this wave of scandal is so difficult now to convince any client to join this Wells Fargo which shall cause them a lot of money. Also all the old customers may start withdrawing and looking for other banks which they feel are more secure when they are keeping the money for them. It is so hurting and distrustful for a banking instead of accruing money in the accounts of their customers what they wells was doing was that it was misusing their money and giving them extra fees.

In September of 2016, it was revealed that there was alleged misconduct at one of the largest and safest banking institutions in the United States. Wells Fargo Bank was ranked among the nation’s safest financial institutions according to an analysis done by Global Financial, (Inside Tucson Business, 2009). Alleging that between May 2011 and July 2015, there were more than 2 million bank accounts or credit cards opened for customers without their knowledge or permission (Blake, 2016). Clients started complaining the they were receiving debit/credit cards from the bank that they had not ordered. Wells Fargo employees also started complaining that about the unethical behaviors they witnessed or were asked to participate in to the Human Resource Departments, the bank’s internal ethics hotline, branch’s individual managers and supervisors. All which led to the discovery of the fraud scandal.

Scandals in the business world are not an uncommon topic to appear in new headlines. Recently Wells Fargo has fired over 5,000 employees for creating over 2 million fake accounts. New bank and credit card accounts were created without prior knowledge from their customers. The accounts that were created resulted in those customers inquiring fees such as overdraft fees. These fake accounts have been created over a five-year timeframe.

The reason why Well Fargo Bank is an ethical quandary would be how they have gotten a fine for 185 Million dollars and have fired over 5,300 which were employee and manager.

HSBC’s landmark punishment gave way to a plethora of media coverage and through the use of a reassuring and confident tone, HSBC and the DOJ were able to control the narrative of the media reports. Numerous public watchdog groups and social justice advocates clashed with the conclusion of the investigation, thus the DOJ’s Office of Public information was compelled to convince the public that the course of action taken was justified. “‘Today, HSBC is paying a heavy price for its conduct, and, under the terms of today’s agreement, if the bank fails to comply with the agreement in any way, we reserve the right to fully prosecute it’” (Office 4). The Office of Public Information used a reassuring tone to sway public opinion that HSBC was given an appropriate consequence in order to quell