Wells Fargo is one of the world’s largest financial institutions. Wells Fargo has been involved in a scandal concerning the legality of the entity in the recent years.
Employees were incentivised to open different kinds of bank accounts for the customers, even though the customers never agreed to this or even knew about it. Said employees were promised to get a commission or a salary bonus if they would meet the target set by the corporate of accounts to be opened. But in reality, some employees were threatened to lose their jobs if they didn’t keep up with the targets. Usually they would target people that had a low probability of examining their credit situation in a regular basis, or people who would go to open an account and without knowing about it, end up with more than one account that they didn’t ask for (and are paying for).
However the quotas set by the directives of Well Fargo were much higher than what is achievable, hence why employees resorted to illegal ways to achieve the goals. Naturally this whole process was illegal and unethical, even though it went on for years until Wells Fargo was busted.
So who are we to blame? Most people would say the employees who distorted to illegal ways in order to get the numbers. But in my opinion the employees are just regular workers who are trying to earn money the same way a carpenter or a teacher would, only in Wells Fargo’s case the employees had a massive amount of pressure on them to achieve certain targets, which led them to do what they did. In my opinion it is the top line managers and the line managers who are to blame, since they are the ones who make the goals and targets and it all starts from them and goes down onto the employees. Plus it is quite disrespectful and unethical to do what they did not for days or weeks, but for years.
The HR staff played a big role in this scandal. If the HR department had worked effectively being responsive to all the complaints that were given to Wells Fargo, and had been willing to change the conduct as soon as they got a complaint, the story would be much different. The Human Resource department of Wells Fargo should have had helped the managers to set realistic goals and have achievable expectations, while providing training of a good code of conduct to their employees. However, in any case, it is still quite a bit of a responsibility to lay on the HR department to take a stand on the executives of the organisation.
The real lesson out of this case is to set realistic goals and not go overboard after profits, while keeping things legal and not resorting to unlawful ways of generating money.
Sources
- Workers tell Wells Fargo horror stories. CNN. URL: http://money.cnn.com/2016/09/09/investing/wells-fargo-phony-accounts-culture/index.html Accessed 29.11.17.
- Wells Fargo boss urged to resign over accounts scandal. BBC. URL: http://www.bbc.com/news/business-37419968 Accessed 30.11.17.
- Wells Fargo boss John Stumpf steps down. BBC. URL: http://www.bbc.com/news/business-37639648 Accessed 30.11.17.
- U.S.: Wells Fargo illegally repossessed 413 service members’ cars. CNN Money. URL: http://money.cnn.com/2016/09/29/news/wells-fargo-servicemembers-cars/index.html Accessed 30.11.17
- Wells Fargo tries to kill fake account lawsuit. CNN Money. URL: http://money.cnn.com/2016/11/25/investing/wells-fargo-lawsuit-forced-arbitration/index.html Accessed 30.11.17
- Wells Fargo Code of Conduct found in Moodle.
Basics of Human Resource Management 