Ethical Misconduct In Wells Fargo

Absent or poorly written codes of conduct are the reason for unethical conduct in organizations. Just look at the recent outbreak of unethical events with Wells Fargo, Enron and Volkswagen (McLaverty & McKee, 2016). Companies and their upper management push for better profits and forget to create a strong ethical culture. Creating large incentives for employees and management for achieving lofty targets create an environment for people to act unethical to meet their numbers. In 2016, Wells Fargo associates opened over 1.4 million accounts without their customers even knowing about the account (Goldfarb, 2017).

The Wells Fargo scandal involved a variety of stakeholders who have stake in the issue; however, the main stakeholders include the consumers, the employees and their families, and stockholders of the organization. The affect these stakeholders suffer varies, but the ultimate affect the scandal has had is violation of trust by Wells Fargo and its leadership. When examining this situation, the main stakeholders who suffered the greatest harm from the scandal were the customers who fell victim to the fraud and had their privacy violated by an organization they trusted. In the course text, Trevino and Nelson spoke of the importance of trust and its importance in a service economy. Wells Fargo violation of the consumers’ trust has ultimately added

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

The employees need to be educated on the ethics in business and the importance of complying with the ethical codes of the company. The employees need to be made to understand the importance of ethics in business and the values ethics adds in the business. Occasionally, ethics is a key to business success and it is paramount that the employees understand and appreciate the fact. The employees need to know the upholding business ethics is necessary to assure the stakeholders of the future of the business and that they can continue investing their time and money in the business. If the employees at Wells Fargo were educated on the importance of ethics and the roles ethics plays in the business, the case of the scandal could not have been witnessed.

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.

(1)Most adults can certainly agree that they hate bank fees. Even worse than paying bank fees, is paying a fee on a ghost account you did not know existed. Wells Fargo is a successful American International Financial Institution, but in recent years have been involved in a scandal that has hurt their reputation.

In my opinion, this scandal is much deeper then it appears. It looks like we have a case were the company is corrupt at the very top, where these unreasonable expectations came from. Employees of the company felt like they had to go to extreme measures and do illegal things simply to keep their jobs. This is not fair nor should it be allowed. The main underlying problem in this situation is that Wells Fargo is not being ethical towards their employees. These employees have responsibilities, such as feeding themselves and their families, so of course they will go to extreme measures to keep their job. The more I read into this case the more I felt like the heads and directors of Wells Fargo were in the wrong more then the people that were actually

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.

According to the more than 5300 Wells Fargo’s former bank staff, direct cause of fraud is the bank directly linked employee compensation and sales performance. To face the difficulty of matching the sales aim, they had no other choices but to take a risk, and ultimately will inevitably damage to the interests of customers as the

The first stated values, states that Wells Fargo’s value open, honest and two communication, which did open a hotline dealing after the scandal and handle the customer service. Though, I would not consider that company honest, but maybe openness after the fact. The second state values is based on accountable and proud of their conduct and decision dealing with Wells Fargo’s. Though, Wells Fargo is unethical in it business practices still used well known business practices and process to motivate salespeople open multiple accounts without the customer permission. Such as training employee in techniques into frauding customers and a system of rewarding for such behavior. Which shows a totally disregard for the customer financial well being

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.

This fear and intimidation was brought on by the extreme sales goals set by the company, which included selling various products to every day depositors who only wanted to maintain their standard checking account. Each employee was expected to push at least eight other accounts on these customers and they would be monitored on a regular basis to be determined if they were meeting their required quotas (Hightower, 2016). All this pressure pushed from management to the employees would squeeze employees to their breaking point, which was all for the sole purpose of CEO Jon Stumpf and his board of directors to drive up values on the Wells Fargo stock and put millions of dollars in their own pockets while others suffered (Cameron, 2016). Based

The management at wells Fargo relied on compliance as a strategy for managing its ethics (YouTube, 2018). The management set standards that employees were expected to meet. For instance one employee reports that in the line of work she realized that she was unable to meet the set goal. She decided to call the banks ethics hotline to explain to the management that there was no ethical way of making such huge sales (Cowley, 2018). The management at Wells Fargo was using the low-level employees to open accounts without informing the customers (YouTube, 2018). Although the management says that these was not the company’s culture as reported by the employees. The same workers who were engaging in opening more accounts were working in the same roof

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.

Hiding or divulging information: Goldman bet against their clients several times. They knew material information on certain investment; however, they never communicated that to their clients because they were making money off them.