CNN: 5,300 Wells Fargo employees fired for creating over 2 million phony accounts

The BBQ Pit
101

Maybe but I wouldn’t rule federal prison time out. Only time will tell. Senator Warren strongly hinted at it and she is serious if she can help make it happen. I am sure that if they dig deeply enough, the feds can come up with enough violations for a scholarship to Club Fed for at least a decade. His family may get to keep most of the money but all the money in the world doesn’t mean much when your bunk-mate is former Illinois Governor Blagojevich and you are stuck in the middle of nowhere under lock and key.

Martha Stewart got sent to prison for something trivial compared to this after all. I am normally not a big fan of the federal government but I am firmly on their side on this one. They need to cap his ass so hard that it puts the fear of God in other executives that have similar tendencies. The death penalty may be a little harsh in this case but long-term solitary confinement in a Super-Max facility would be perfectly fitting. Even the most determined terrorists don’t run rings that directly target millions of people for years on end.

102

This is wonderful.

103

Someone I know works there. Some years ago, they discussed (I was inadvertantly eavesdropping, oddly enough) with a relative that they were looking up celebrities bank accounts and oohing and ahing at the $$ figures. It was like they worked at a junior high or something. Thought it was super unprofessional, and should get someone fired.

This latest makes me wonder if this person was among those fired. Is there a list somewhere to peruse, that would be interesting.

104

I see it differently. My contempt for Senator Warren increases from stunts like this.

You can’t determine innocence and guilt solely based on the fact that you dislike CEOs. You need the details. Warren has no interest in anything as trivial as that. You’re a CEO whose company messed up and she’s going to attack you, to the cheers of liberals all over.

The fact is that a CEO can’t control everything that goes on in a company. Sometimes things happen that a CEO should/could have known about, and sometimes not. You need to look at the facts in each individual case, rather than just mindlessly attacking disfavored classes of people.

105

Huh.

I actually listened to the full video. Sen. Warren was providing transcripts of phone calls and reports as part of evidence, did you get that far?

Also, the CEO directly profited from the effects of this fraud even if he wasn’t aware of what was going on. Why should he keep the money? If my spouse were to steal $100k by a fraud scheme and put it in our bank account without my knowledge, then was caught, why should I be able to keep the stolen money? Why should the CEO of a company be able to keep money acquired by fraud?

I applaud Sen. Warren for questioning the CEO and not accepting corporate-speak answers. Honestly, he SHOULD be able to give a straight “yes” or “no” to what she asked.

And, get a grip, yes, the CEO is in fact responsible for what goes on in a company and it is part of the job to make right (to the extent possible) wrongs committed by the company. Unless you are in the top 1/2 of the 1%, then you’re immune. I believe that to be wrong, no one should be above the law.

106

Ghetto-edit - and the notion that a CEO of a major bank is a member of a “disfavored” class of people is ludicrous. Seriously, I almost hurt myself laughing.

107

Yep,Warren branded his ass with “retaehc” and “koorc.”

108

Did you pay attention to what those phone calls were?

She didn’t have any secret incriminating phone calls, as you seem to be trying to suggest. Those phone calls were just WF’s earnings calls, where they trumpeted WF’s success at cross-selling. Cross-selling is not in and of itself fraudulent, and is pretty standard for all sorts of business. Obviously something went wrong at WF in that some employees pushed it too far, but the mere fact that the CEO touted cross-selling isn’t any sort of evidence that the CEO knew or should have known about the fake accounts.

To the contrary, the fact that people like Warren are willing to hold up public support for cross-selling - something most businesses in America are engaged in - as an example of something fraudulent, is an example of the mindset she has, and why she’s very much a net negative.

Laugh all you want, but it’s true in the case of Senator Warren. Possibly in your case as well.

What’s a “ghetto-edit”?

109

A ghetto-edit is when you miss the time limit for editing your actual post so you need to make a follow-up post instead.

110

The point is not that cross-selling is inherently fraudulent, but when a business is consistently performing at 200% of everyone else and increasing that might warrant another look. One of the things auditors look for is not just outright errors but instances when things are TOO good or perfect which may also indicate a problem.

Setting unrealistic sales goals is stupid for business. When those goals start being MET it’s time to take a closer look. I’m just a lowly peon and I know that, why doesn’t a CEO?

Apparently you glossed over where Sen. Warren mentioned the industry average for cross-selling then pointed out that WF’s was TWICE that. It’s as if everyone in an industry was reporting 5% profit on something except for one single company consistently report 10% profit on it - you have to wonder what’s going on there. It certainly warrants another look.

111

Sometimes businesses perform much better than other businesses in certain metrics because their business model is different and/or they emphasize different things.

[At one point my own firm had a profit margin that was about half that of our major competitors. Part of it was not enough emphasis on profit margin (versus revenue and growth) - which precipitated a change in focus at the firm, but part of it was also a different mix of businesses. At any rate, nobody was suggesting that any of the competitors must have been engaged in anything illegal.]

WF did in fact have PWC conduct an audit, which is how the scale of the unauthorized account issue came to light.

112

Wait a minute. The accounts in question aren’t cross selling, they where opened without the account holders knowledge.

113

The employees who opened the accounts pretended that they were cross-selling. The issue is that WF employee incentives for cross-selling encouraged these employees to do that.

114

Ah, thanks.

Surely plenty of people complained when they discovered that they had multiple accounts that they did not open. It had to be more than just the low level employees that knew what was going on.

115

That’s actually the one part of it that I don’t really fully understand. I have various accounts at various financial institutions, and I constantly get mail from these institutions relating to these accounts - statements and the like - and if I got one which referenced an account that I was unaware of I would be on top of it immediately. That leads me to wonder how these employees thought they could get away with something of this sort even a single time. But yet, they clearly did …

As to your point, it seems that people at WF have been aware of it - the 5,300 employees who were fired were fired over a period of several years. But it sounds like they weren’t aware of the scale of the issue until the PWC audit (which seems to have been triggered by a LA Times article).

In businesses that are as big as WF, there are always going to be some bad apples. If there are a few bad apples here and there, it gets dealt with on the local level, and the CEO never hears about it. If it’s a very broad systemic problem then it goes to the CEO level and he does. Question in this case is when the CEO knew - or should have known - about it. I don’t know. I don’t think Senator Warren does either. The difference in her case is that I don’t think she cares either.

116

My guess is more that their managers either 1) knew about it but didn’t make a fuss because hitting their sales target was more important, or (more likely IMO) 2) plain just *told *them to do it. And those low level managers might even have been told to do it by even higher ups. I don’t care how large your company is, a problem doesn’t reach these kinds of proportions just by way of lowly clerks elbowing and winking at each other around the water cooler.

117

As there may be people waiting…

Background: Opened a mortgage with WF back in 2011. Guy @ bank, we’ll call him Dingus, is HIGH PRESSURE, calling me at 6:30pm some nights to talk about opening up accounts. Told him no: doing mortgage, talk to me later, don’t want to complicate paperwork, etc. After I hand him mortgage paperwork to hand to Mortgage Guy, Dingus takes the info and opens a whole raft of accounts in my name, sans signature. Immediately, I open (I thought) a can of whoop-ass on his butt, bringing in him, his manager, his district manager, my mortgage guy all in on this, culminating in calls back and forth with corporate.

Nothing happened as far as I could tell - Dingus still worked there as of last Monday.

Went to Wells Fargo last Monday with copies of emails, checks, and other documentation regarding said faked account opened by Dingus. It may be five years later, but paper lasts, so I’m good.

Sign in the book, waiting for a manager. Dingus walks up:

“JohnT?”
“Yes, Dingus?”
“Looks like you’re up - follow me please.”
“I’m sorry, I need to see a manager.”
“Well, I’m the ranking manager at the branch today, how can I help you?”
“I need to see a different manager, please.”

So this poor lady, a shift manager (Dingus was like “day manager” and his boss, the actual Branch Manager (she wasn’t in today)) and I go into a room.

Lay out documents, going into facts and timeline of case. She goes white. Looks up at Dingus. Looks back down. Excuses herself, goes into her office, closing door, getting on phone.

Gets off phone, comes back to me. (Dingus, I’m sure, is aware of this activity - it’s a suburban bank, not an office building.) Calls a number, in seconds both Branch Manager and Some Guy In Dallas are on the phone.

I go through the entire thing: Purchased house. Applied for mortgage. Started receiving pressure from Dingus (yes, here are my notes from 5 years ago), told him “no” repeatedly. Dingus opened accounts anyway after I dropped off mortgage app and documentation @ bank (I actually handed them to Dingus, told him to give to Mortgage Guy). I met with Great Vengeance and Furious Anger… apparently to no avail, obviously.

So, get this, they literally ask me what I want! I said “legally and compensatorally, haven’t talked to any of my attorneys about this, so can’t answer this question from that angle. But, however, you have fired 5,300 people… and I bet if you do a review of his work, with this new paradigm in mind you’ll end up with 5,301*. So, for now, I want you to do a review of his activity since September, 2011 leaving the decision up to you. After all, this is a cultural issue - this isn’t some rogue trader at Barron’s bank jamming some bad bonds in his desk - this is institutional, and it has infected this branch for the past 5 years.”

And that pretty much was that. Got some names, numbers to contact to find out what happens with this case.

However… compared to the other bank fraud case that dropped in my lap last week, this is nothing.

In the end, I’ll probably get a check for $62.53 sometime in 2019.

*Thanks to JKelly for the line!

118

You should have handled that on the internet where, as you claimed, you never lose.

119

:stuck_out_tongue:

120

That’s must be why they get paid those meager minimum wage salaries, it’s such a tough job, why would anyone want to do it? I mean, really, what CEO has any control over the company that they are merely the Chief Executive of?

How could we possibly hold someone to account just because they are the one who has accepted the position of responsibility? It’s not like any perks come along with the job.