Question

The Wells Fargo scandal began unraveling in September 2016. Federal regulators divulged that Wells Fargo employees created millions of secret bank and credit card accounts without customer approval. They received a $185 million fine and revealed that they had fired 5,300 employees because of the fraud. Fast forward to 2018, the scandals continue to mount for this company.

Regulators have fined Wells Fargo for their unethical business practices. Do you believe that regulators have done enough to deter Wells Fargo from repeating this behavior or do you believe that regulators have failed and are allowing Wells Fargo to continue the status quo? What is your proposal? Support your answers by citing research on the case.

Answer 1

The Wells Fargo account fraud scandal is an ongoing controversy brought about by the creation of millions of fraudulent savings and checking accounts on behalf of Wells Fargo clients without their consent.The Wells Fargo scandal began unraveling in September 2016. Federal regulators divulged that Wells Fargo employees created millions of secret bank and credit card accounts without customer approval. They received a $185 million fine and revealed that they had fired 5,300 employees because of the fraud. Fast forward to 2018, the scandals continue to mount for this company.

on February 2 nd 2018  The Federal Reserve punishes Wells Fargo. In an unprecedented move, the Fed says the bank won't be allowed to grow its assets until the bank cleans up its act. The bank also agrees to overhaul its board of directors.If this stringent action taken already and would have taken more preventive measures it wont occur again

AT wells fargo a high pressure sales culture was there because of that reason Employees were given impossible sales quotas to reach, and berated or even fired for not meeting them. And so they cut corners.if they management change the view of How do you measure, evaluate, reward, and punish employees? it would show up a better result.Financial regulation cannot prevent this kind of scandal ,its more about a good employer -employee relationship.How do you motivate an employee to really take heart in their work, and give it their best? How do you inculcate a culture where the bank genuinely cares about the customer, with the belief that this will rebound to its long-term advantage?

An organization’s ethical culture reflects its values and informs the perceptions formed by both employees and customers. As such, the culture becomes the primary driver for both individual and group ethical decision-making and behavior. However, maintaining ethics in business settings, especially in large organizations such as Wells Fargo is a complex and challenging process. Ethical behavior and decision making in organizations involves dynamic forces, making it easy for ethicsto slip between the cracks, or fall into blind spots, often unnoticed until it is too late.