Wells Fargo, the Leadership, and the Culture



The culture of a company or an educational intuition is developed and maintained by the leader and the members of the leadership team.  A recent and popular story in the media involves several Wells Fargo Banks and the two million fake accounts.  Employees of Well Fargo opened fake accounts in the names of un-expecting customers.  Some of these customers were charged fees related to these fake accounts.  What allowed this massive fraud in a company like Wells Fargo to go on for years?

Some of the employees of Well Fargo described a cultural shift from caring about the customer and providing the best service for each individual customer.  The new normal consisted of each employee must met a sales quota of eight to twenty products (opening of a new credit card or other lines credit) or face the consequences.  The consequences included a mandatory coaching meeting that consisted of belittlement, written reprimands, and threats of termination.  Any attempts of whistleblowing were met with immediate termination.  The culture no longer involved servicing the needs of the customer, but making a sale.  Many employees felt forced to create the fake accounts to avoid the reprimands, leading to widespread fraud.

Where were the leaders?  Where were the checks and balances?  The CEO John Stumpf stated in hearings on Capitol Hill that he was not aware of these practice until 2013.  He solely places blame on the senior leaders of the company for creating a negative working environment for the employees.  I find it hard to believe that over two million accounts went undetected for a number of years.  What happened to all of those open lines of credit?  Did someone use the money associated with these fraudulent accounts?  As the investigation continues, over five thousand low level employees associated with the fraudulent accounts have been terminated.  A senior leader directly involved in the fake accounts was allowed to retire while taking home a paycheck that was over 125 million dollars.  Several lawsuits against Wells Fargo are in progress.  Now, Wells Fargo will have a new culture of customer distrust that must be changed.

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