Why Is Wells Fargo Wrong

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.

Wells Fargo has a social responsibility to its customers to fulfill their economic, legal, ethical, and philanthropic needs. The scandal has presented numerous legal issues. It was negligent of the bank's executives and managers by placing impossible sales goals on lower level employees then encouraging, and pressuring them to meet these goals. The use of customer's information for fraudulent purposes was an invasion of customers privacy. Wells Fargo has violated the Federal Trade Commission Act which protects customers from unfair practices and has also violated the Sarbanes-Oxley Act (Thorne, 2011).

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.

Looks like "Wall Street got something right for once," said Tim Mullaney at Market​Watch. Wells Fargo CEO John Stumpf abruptly resigned last week, forced into retirement by devastating revelations that employees secretly created some 2 million fraudulent accounts in order to meet unrealistic sales quotas. The banking giant had already fired some 5,000 workers over the scandal, but as it became clear that the malfeasance was rooted deep in Wells' corporate culture, "accountability needed to be had at the top." Finally, a banking executive is taking the fall for his company's misdeeds, said Helaine Olen in Slate. Why is this time different? JPMorgan Chase's Jamie Dimon, for instance, still has his job despite the fact that lax oversight allowed

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.

As I know about pay-for-performance systems is you got paid or earn money by how you worked well or your work evaluation is good. I think many companies using this system such as insurance, and auto dealers. Personally I didn’t know about this scandal until I read this article. I both surprising and not surprising because I knew that banker going to get any benefit by opening new account or credit card sort of things. However, it is surprised that Wells Fargo did this. I am not using Wells Fargo, but many of my friends using it and they always told me that the bank is good, so that I had image of honesty to Wells Fargo. So I little disappointed that they did illegal actions to get paid.

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.

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.

As the scandal made national headlines, the Department of Justice opened an investigation which resulted in Wells Fargo former CEO John Stumpf testifying before the U.S. House of Financial Services Committee, where he avoided questions as to how the bank would help customers it harmed and whether it would recover income from executives. According to Rucker, Stumpf took full responsibility for “all unethical” practices for the Senate Financial Committee (2016). After testifying before the committee, Stumpf submitted his resignation after 37 years with the company due to his reputation being tarnished. Wells Fargo continues to suffer from the fake account scandal as several states and municipalities continue to end business relationship with

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.

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.

Conflict is a natural part of any work environment. What considers it healthy conflict is how the individuals involved respond? Handling and resolving conflicts that arise in the workplace is one of the biggest challenges managers and employees face. “The consequences of health care workers’ conflict are many.” Patton goes on stating, “At best, conflicts result in beneficial changes in the workplace; at worst, it can impact patients’ lives.” (Patton, 2013) By learning to constructively resolve conflict, we can turn a potentially destructive situation into an opportunity for creativity and enhancement for performance. Janice Frates stated, “…,having work teams at all organizational levels openly and vigorously debate their ideas is a form of healthy conflict that produces both stronger team relationships and better work outcomes.” In regards to the St. Clair Hospital plan for cost control, a healthy conflict did not arise.

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.

As the expression of employees' dissatisfaction and differences with employers, conflict is regarded as bad and irrational for the organization and should be kept down through some forcible ways. Conflict can arise from employees' misunderstanding of the direction of the organisation or the poor communication between the staff and the management, enabling employees to substitute alternative agendas instead of the organisation's agenda (Bray, Deery, Walsh and Waring, 2005). Moreover, conflicts can arise from the poor management that caused by the management's failure to identify and meet employees' basic needs.

Conflict is an occurrence in virtually any organization, regardless of how large or small it may be. It is exceedingly difficult to get people to agree with one another about everything all the time, especially when they are competing for the same resources (Tsang, 2012, p. 84). This difficult is naturally exacerbated when there are stratifications between people, which frequently occurs in organizations. Organizations may have different categories of employers such as those in sale, marketing, finance, human resources, etc. The three main views of conflict which also play a significant part in the resolving of conflict are the traditional, the human relations, and interactionist views. There are points of similarities and differences between all of these views.