10 ms·

Wells Fargo CEO John Stumpf Steps Down

312 points by smaili 10y ago

taurath 10y ago
My understanding is that they created a system of unrealistic expectations as far as accounts per customer, had managers from the top that pushed this on people and they got fired. Then, in the case where employees started reporting that they were forced to do the activity to keep their jobs, nothing was done. This seems more like a lever that can be pulled here: Prevent banks from having ineffective whistleblowing processes by mandating use of a FINRA whistleblowing program. The person in the top comment being fired would get protected by Finra for her future employability, and Wells Fargo and other banks would take whistleblowing far more seriously. I admit it sounds very simplistic, but is there something crucial I'm missing here? I can't see how one would file charges at the top executives for "incompetantly making an internal ethics line" and "setting too difficult sales goals, causing an unintended fraudulent effect".
webaholic 10y ago
Go Elizabeth Warren! Without her prodding, I am sure this would never have happened. He was very happy with firing the 5k employees and not taking any blame on himself for what was essentially his push.
- droopybuns 10y ago
  Prodding? What investigating did she do?
  - epistasis 10y ago
    What does investigating have to do with prodding? Meanwhile, she prodded pretty heavily in those congressional hearings...
  - lobster_johnson 10y ago
    https://www.google.com/amp/s/www.yahoo.com/amphtml/news/how-elizabeth-warren-used-a-new-congressional-power-to-punish-wells-fargo-193310805.html https://www.google.com/amp/s/www.yahoo.com/amphtml/news/how-...
    - loeg 10y ago
      Ugh, Amp mucking with URLs. Real link: https://www.yahoo.com/news/how-elizabeth-warren-used-a-new-congressional-power-to-punish-wells-fargo-193310805.html https://www.yahoo.com/news/how-elizabeth-warren-used-a-new-c...
  - Bud 10y ago
    Uh, she invented the entire fucking government agency that polices this crap, absent which, there would be nothing.
- kaonashi 10y ago
  I'll save my you go girl for when he's in jail.
- shill 10y ago
  I suspect Warren Buffet may have pushed for Stumpf's resignation/termination, as well as other damage control measures. This is a similar situation to the Solomon scandal, although Buffet has a smaller stake in WFC.
  - bogomipz 10y ago
    Was WF one the banks he took a stake in after the 2008 crisis?
    - tedmiston 10y ago
      From an article last month [1]: > Berkshire Hathaway (BRKB) owns nearly 470 million shares of Wells Fargo (WFC), a 9.5% stake. Buffett also personally owns a little more than 2 million shares in the bank. The combined value of that investment has dropped by nearly $1.5 billion since Friday. I could see why he might be upset. [1]: http://money.cnn.com/2016/09/14/investing/warren-buffett-berkshire-hathaway-wells-fargo-fake-account-scandal/ http://money.cnn.com/2016/09/14/investing/warren-buffett-ber...
      - x0x0 10y ago
        I would also suggest Buffett is very focused on his reputation, and doesn't want to be seen tolerating behavior like this. From one of his letters to his managers: We can't be perfect but we can try to be. As I've said in these memos for more than 25 years: "We can afford to lose money — even a lot of money. But we can't afford to lose reputation — even a shred of reputation." We must continue to measure every act against not only what is legal but also what we would be happy to have written about on the front page of a national newspaper in an article written by an unfriendly but intelligent reporter. http://blogs.wsj.com/deals/2011/03/31/warren-buffett-on-ethics-we-cant-afford-to-lose-reputation/ http://blogs.wsj.com/deals/2011/03/31/warren-buffett-on-ethi...
      - bogomipz 10y ago
        Indeed, thats a lot of wealth that has evaporated in a short period of time. Interesting, from your link: "In fact, Berkshire Hathaway filed papers with the Federal Reserve this year for approval to boost its stake in Wells Fargo beyond 10%"
RKoutnik 10y ago
Meta: Looks like WSJ is smart enough now to detect the `web` links. I went directly to the site, hit paywall, backed out. Then went via the `web` link, same paywall. Went to `web` link in incognito, was able to read the (fairly anemic) article.
- azhenley 10y ago
  Interesting, the web link worked for me.
- figers 10y ago
  it's hit or miss, but I rarely have to do incognito for WSJ
  - eric_h 10y ago
    I think they cookie you on the direct link hit, so going back and doing the web link doesn't work without incognito (IME).
    - tmm 10y ago
      I get the paywall, even in incognito across all browsers. They must also be tracking by IP.
      - eric_h 10y ago
        Fascinating. I work at a large WeWork (hundreds of people, ~9 floors of a 12 story building in manhattan). I wonder if I'm silently benefitting from WSJ subscribers who work out of there causing our ips to be whitelisted for uncookied, google-referred views. Do you do most of your browsing from home?
- eric_h 10y ago
  Yeah, I've had to do incognito on the WSJ web links for a while now.
- mjevans 10y ago
honkhonkpants 10y ago
Honestly I still don't understand why this organization continues to exist. Banks are chartered by the government for the purpose of safeguarding deposits. This bank was engaged in fraud on a huge scale. Their charter should be terminated.
- sverige 10y ago
  Too big to fail. 2008 wasn't that long ago, remember? If the big banks go down, a lot of politicians lose a lot of money.
  - ianai 10y ago
    They should be broken up
  - honkhonkpants 10y ago
    It doesn't have to fail. Its administration can be taken over by a purpose-built entity (or the army corps of engineers, who cares really) and all sales and marketing can be halted while everything is liquidated in an orderly fashion.
  - ArkyBeagle 10y ago
    https://www.amazon.com/Fragile-Design-Political-Princeton-Economic/dp/0691155240 https://www.amazon.com/Fragile-Design-Political-Princeton-Ec... Read that then form an opinion.
- phil21 10y ago
  Fraud against themselves mostly. I think you'll find all the major retail banks had policies very similar to Wells Fargo. Wells Fargo was certainly the tall poppy, but I have friends who have worked there and at other similar banks in a retail banker role - they didn't think anything abnormal of the sales pressure at WF, just noted it was a bit more intense than what they were used to and actually generally found WF to be better to work for than the other majors. I would even go so far as to argue the vast majority of consumer service sales operates under such unsustainable models as well, which encourage if not outright imply fraud. Ask any retail cellular employee and they'll be able to tell you stories that sound identical to Wells Fargo. Cramming is the default state of the game, since "corporate" will always continue to ratchet up sales quotas until they are unachievable for most moral people. I think I'm mostly surprised anyone cares, it's been going on for a decade plus and this sort of stuff is an open secret among retail sales in many industries. Why is it only now being reported? Why is only Wells Fargo being singled out? I don't oppose your solution. I'm just curious who Wells pissed off or didn't pay off, that the other banks apparently did.
Bud 10y ago
Whatever. Will he get a nine-figure golden parachute like the other senior exec who just left? If not, this does not impress me. Will any of his earnings and bonuses be clawed back? If not, this does not impress me. What about the other execs responsible?
- maxxxxx 10y ago
  It will be a massive golden parachute. No doubt.
  - endswapper 10y ago
    "Financial details of Stumpf's retirement plan are unknown, but Equilar estimates he walks with $134.1 million from retirement. The package remains that large even after Stumpf last month agreed to a $41 million clawback following a grilling he received from the Senate Banking Committee reprimanding him for not taking responsibility. He agreed to give up unvested stock, but still owns shares vested in previous years.[0]" [0]: http://www.usatoday.com/story/money/markets/2016/10/12/wells-fargo-ceo-retires-under-fire/91964778/ http://www.usatoday.com/story/money/markets/2016/10/12/wells...
    - carsongross 10y ago
      How do you "give up" unvested stock?
      - vkou 10y ago
        Get fired or quit before it vests. (Conditional on your contract.) Edit: If you are a C-level executive, your contract may stipulate that you get unvested stock, even if you're fired. It's possible that John Strumpf chose not to exercise any such clause, but I strongly doubt it. The man is a psychopath.
        carsongross 10y ago
        Right, but that seems like it's being extremely deceptive: when you quit or get fired you stop vesting. It isn't clawed back in any meaningful way. When you or I leave a startup, we don't talk about our unvested options getting "clawed back".
tomrod 10y ago
I would expect no less. Given the size of the issue, it's virtually impossible that he didn't know about it. I'm assuming competency here, as he was leading one of the largest banks in the world.
dbg31415 10y ago
Headline tomorrow, "John Stumpf Steps appointed chairman of the board of Wells Fargo."
miguelrochefort 10y ago
Shit's about to go down.
Smerity 10y ago
I highly recommend listening to a recent episode[1] of Planet Money. This was by no means an accident. As a short summary of one employee's plight: Ashley, working for them and making only $35k per year in San Francisco, was continually harassed to sign people up for accounts they didn't want. An old man comes in, pensioner, $200 in overdraft fees due to being duped into excess accounts. She dips into her own savings to get him back in the black. She reports the incident to the internal ethics line. Nothing. Tries again. Nothing. She refuses to fraudulently push excess accounts onto people. Fired. Worse, Wells Fargo put her onto a permanent blacklist that others in the industry pay attention to - she can't get a job anywhere else. Imagine making $35k per year in San Francisco - insanely low given the region - and dipping into your own pockets to help fix a situation your own company created. Then, as thanks, being eventually fired by that company for not continuing the practice and being blacklisted in your field of work. I'm desperately hoping Ashley sues Wells Fargo in a defamation suit but I fear the likelihood of that is low - even if it's not the first time it has happened to Wells Fargo[2] ... At best, upper management were willfully negligent of the impact that their insane sales goals had on the ethics of the company. At worst, upper management were actively trading any ethical notions they could get hold of for money, ripping apart the lives of employees and customers on the way. [1]: http://www.npr.org/sections/money/2016/10/07/497084491/episode-728-the-wells-fargo-hustle http://www.npr.org/sections/money/2016/10/07/497084491/episo... [2]: http://www.forbes.com/sites/billsinger/2011/12/15/wells-fargo-hit-with-punitive-damages-in-finra-u5-defamation-case/#225a6d7d7af1 http://www.forbes.com/sites/billsinger/2011/12/15/wells-farg...
- hilop 10y ago
  "permanent blacklist"? That sounds like the High Tech Employees Lawsuit case, but a much easier win for a more sympathetic class of victim.
  - newjersey 10y ago
    Not to be overly dramatic but I would imagine it depends on who the jury sympathizes with.
    - 10y ago
erickhill 10y ago
I'm surprised no individuals at the executive level have been charged with crimes, to be honest. Or perhaps it's simply too soon and that's the next shoe to drop.
- cloudjacker 10y ago
  Surprised, he says
- Kalium 10y ago
  It takes time, effort, and care to build a strong case against a senior executive. Not something that can be done overnight.
  - ethanbond 10y ago
    Definitely. That's why we're going on, what, almost ten years since the collapse with barely any real repercussions for any senior financiers in the county! We've just gotta be more patient... It'll happen.
    - Kalium 10y ago
      And sometimes there are no senior executives who did anything clearly identifiable as criminal under the laws at the time. Just because something terrible happened doesn't mean it's provably criminal and the fault of particular people.
- ianai 10y ago
  It does take a while. I don't think anyone was prosecuted for the Great Depression until about 10 years later, IIRC.
- the_watcher 10y ago
  It takes a shockingly long time to get to the point where you can file criminal charges. IANAL (but I did go to law school) but you need time to, at minimum, decide which charges to file (and ensure there are no jurisdictional issues), where to file them, talk to witnesses, file requests for documentation, etc. On top of all that, if you don't dot your i's and cross your t's perfectly, a judge could dismiss the case.
GCA10 10y ago
Bravo to the directors for waking up. Any time there's a long-serving CEO of a big public company, it's as if the directors have been chloroformed. They generally show no ability to question the boss, let along hold him/her accountable for anything. Most of the other boards that should be waking up ... probably won't. But at least they've got a reminder that it's possible.
- infinite8s 10y ago
  He's also chairman of the board. Not sure if he's relinquishing that role.
  - dredmorbius 10y ago
    I'm pretty sure he is. Though NYT doesn't quite say so directly. http://www.nytimes.com/2016/10/13/business/dealbook/wells-fargo-ceo.html?ref=business http://www.nytimes.com/2016/10/13/business/dealbook/wells-fa...
jackmott 10y ago
Why isn't anyone in jail again? We will choke a guy to death for selling cigarettes incorrectly, and can't put people stealing millions in jail.
- jhou2 10y ago
  Well, apparently in America, it helps to not be black.
  - Mao_Zedang 10y ago
    rich
  - deleted 10y ago
    [deleted]
  - a3n 10y ago
    If Stumpf were black we'd be reading the exact same story.
    - MaysonL 10y ago
      cf. the career of Richard Parsons, CEO of Citigroup: https://en.wikipedia.org/wiki/Richard_Parsons_(businessman) https://en.wikipedia.org/wiki/Richard_Parsons_(businessman)
  - gjolund 10y ago
    The race war is just a distraction from the class war.
- ljk 10y ago
  money, power, connection, take your pick
- deleted 10y ago
  [deleted]
- thrill 10y ago
  This is why the management involved is unlikely to see prison: https://www.opensecrets.org/orgs/recips.php?id=D000019743 https://www.opensecrets.org/orgs/recips.php?id=D000019743
rm999 10y ago
Non-paywalled article with basically the same information: https://www.washingtonpost.com/news/business/wp/2016/10/12/wells-fargo-ceo-to-retire-in-wake-of-sham-accounts-scandal/ https://www.washingtonpost.com/news/business/wp/2016/10/12/w...
saintwind 10y ago
Here's the archive link, if anyone needs it: http://archive.is/BqWYq http://archive.is/BqWYq
carsongross 10y ago
Until the headline reads "Wells Fargo CEO John Stumpf Goes To Jail", nothing changes.
- lazaroclapp 10y ago
  I would be fine with "Wells Fargo CEO John Stumpf Ordered to Pay Back Fraudulent Fees to Wells Fargo Clients, Out of Own Pocket" (possibly down to some wealth limit, say, he can keep the $35K he apparently pays to his employees if his fortune is not enough to restore the damage). I am not a big believer in jail as punishment (as opposed to "place we keep people who are dangerous to others, for the good of society at large"). The remedy to fraud should be a fine, but it should be a fine commensurate with the level of fraud rather than a slap on the wrist and it should affect the people involved, not just get passed down to corporate stockholders (which includes pension funds and the like). I would also be fine with a court injunction banning him from working on banking, again, not as punishment but as "this man can't be trusted by society to handle other people's money". All of this after proper trial, of course. That said, bank CEOs are a Least Concern species when it comes to overuse of punishment in the justice system, so if someone wants to jail them until we decide not to jail many other types of non-violent offenders, well... I am not fighting that one too strongly. I just think that in one way it would be a step in the wrong direction.
  - carsongross 10y ago
    Punishments need to be out of proportion to the financial damages they do when they erode public trust, which is a good held in common (and the key to prosperity in the west). This is why someone who runs a charity scam should be punished more than someone who simply mugs people.
    - will_pseudonym 10y ago
      Punishments should always be greater than the financial damages, because otherwise the expected value of fraud will always be positive.
ourmandave 10y ago
A previous article said he could leave with $200M which is not a golden parachute but built up over 30 years of working there. This article says they could take back $41M in stock options, another $4M in bonuses, and probably $20M in 2016 pay. (They paid him $19.3M in 2015.) $200M - $65M = f*ck me
st3v3r 10y ago
He's still not actually being punished. He lost his job. Big deal; he's got a golden parachute. He's not going to go through any of the stress that any of the people he fired for this went through when they lost their jobs. He's not getting fined, he's not going to jail. The worst thing that happened to him is he got a tongue lashing from Warren.
Bud 10y ago
#downvotedwhiletrue
- azernik 10y ago
  Being downvoted is usually temporary (random noise, until the upvoters a arrive). Comments complaining about being downvoted - which, note, are against site guidelines usually last longer. Don't write them. > Please resist commenting about being downvoted. It never does any good, and it makes boring reading.
  - Bud 10y ago
    You're right. I apologize.
- sctb 10y ago
  We detached this subthread from https://news.ycombinator.com/item?id=12696763 https://news.ycombinator.com/item?id=12696763 and marked it off-topic.
suprgeek 10y ago
What is not mentioned in the very thin article is that this scumbag who ruined many people's lives gets to walk-away with $134 Million [1]. [1] http://www.usatoday.com/story/money/markets/2016/10/12/wells-fargo-ceo-retires-under-fire/91964778/ http://www.usatoday.com/story/money/markets/2016/10/12/wells... Yet if a common man had committed any of the fraud - they would be very likely in jail.
ArkyBeagle 10y ago
I watched a lot of his testimony before the Financial Services Committee on CSPAN. So I am unsurprised. He took a fairly savage beating. For some reason, the fact that Wells Fargo is a really big enterprise cut no ice with the various Congresscritters. FWIW, I am not a "break up the banks" guy[1] mainly because of things written and said in podcasts by Charles Calomiris, author of "Fragile By Design" along with Stephen H. Haber. It is all more nuanced and complicated than that, and the small bank lobby in the US really is a thing and a thing that has caused problems. [1] Canada has very close to only one bank and has had no financial crises to speak of.
- Cretin1 10y ago
  "Canada has very close to only one bank.." That's not even close to accurate: https://en.wikipedia.org/wiki/List_of_banks_and_credit_unions_in_Canada#Schedule_I_banks_.28domestic_banks.29 https://en.wikipedia.org/wiki/List_of_banks_and_credit_union... https://en.wikipedia.org/wiki/List_of_banks_and_credit_unions_in_Canada#The_.22Big_Five.22 https://en.wikipedia.org/wiki/List_of_banks_and_credit_union...
  - ArkyBeagle 10y ago
    I'm a bit out of date - the top three ( of the Big Five ) still dominate, though: https://en.wikipedia.org/wiki/Big_Five_%28banks%29 https://en.wikipedia.org/wiki/Big_Five_%28banks%29 RBC was biggest by quite a margin and for a long time.
- st3v3r 10y ago
  " He took a fairly savage beating." He got a tongue lashing. He still has not faced any real consequences for what he did. "For some reason, the fact that Wells Fargo is a really big enterprise cut no ice with the various Congresscritters." Why would that excuse any of it? He's paid ungodly sums of money to be in charge of the company, and be responsible for it. If he can't handle it, then he does not deserve that money.
  - ArkyBeagle 10y ago
partycoder 10y ago
The apology didn't work and clients started demanding accountability. I am glad this happened.
maxerickson 10y ago
I just got a robocall painting the CFPB as anti-consumer and a waste of tax dollars.
bogomipz 10y ago
I Couldn't read the article because of paywall. Is there any news on Carrie Tolstedt the woman who oversaw the unit that created all the fraudulent accounts and gets to retire in July at age 56 with a $124 million pay package? This in addition to the $9 million dollar she took home last year. http://money.cnn.com/2016/09/12/investing/wells-fargo-fake-accounts-exec-payday/ http://money.cnn.com/2016/09/12/investing/wells-fargo-fake-a...
pessimizer 10y ago
The USA Today headline is better: "Wells Fargo CEO Stumpf retires with $134M"
tlogan 10y ago
The title should be: "Stumpf gets with $134M"
slantedview 10y ago
Elizabeth Warren deserves a lot of credit for putting the heat on Stumpf. Coincidentally, one of the leaked Democratic e-mails from this week features banking lobbyists complaining to Democratic party officials about Warren: https://theintercept.com/2016/10/11/warren-goldman-dccc/ https://theintercept.com/2016/10/11/warren-goldman-dccc/ The apparent coziness between the party and the banks is a whole other can of worms, but that Warren doesn't hesitate to go against the party grain and attack folks like Stumpf is a nice thing to see. Good on her.
evanpw 10y ago
Let me just link to Matt Levine's take: https://www.bloomberg.com/view/articles/2016-09-09/wells-fargo-opened-a-couple-million-fake-accounts https://www.bloomberg.com/view/articles/2016-09-09/wells-far.... TL/DR: The bank probably didn't benefit on net from the fraud, even before the fines. This is more a case of management setting unreasonable sales goals and creating a terrible work environment than a conspiracy to commit fraud against bank customers.
- chirau 10y ago
  Did you read @Smerity's top comment above?
- Neeek 10y ago
  I thought the point was that it benefited Strumpf's pocket by falsely inflating share value, not necessarily the bank.
USANEEDSHELP 10y ago
He needs step down, off of a prison bus into a prison. So should the upper management and all of the people that committed this fraud, got away with it and are still employed by Wells Fargo.
JumpCrisscross 10y ago
The New York Times this morning about his supposed successor: "As chief administrative officer from 2010 to 2011, however, Mr. Sloan’s role included overseeing Wells Fargo’s human resources and reputation management. He then became finance chief for three years. And one of his direct reports when he was promoted to chief operating officer last year was Carrie Tolstedt, who ran the offending community-banking division until earlier this year. That makes Mr. Sloan a member of the inner circle that would have known about the wrongdoing from its early days and tried to deal with it. This group hardly covered itself in glory: It was still handing out pink slips in 2016, five years after the first bankers were shown the door. Mr. Stumpf and Ms. Tolstedt have already ceded compensation for the mess. Investigations by the board and regulators may yet implicate Mr. Sloan and others." http://www.nytimes.com/2016/10/12/business/dealbook/wells-fargos-heir-apparent-has-ties-to-scandal.html?em_pos=small&emc=edit_dk_20161011&nl=dealbook&nl_art=9&nlid=65508833&ref=headline&te=1 http://www.nytimes.com/2016/10/12/business/dealbook/wells-fa...
trhway 10y ago
he directed and benefited from massively organized criminal activity - it looks like a RICO case, isn't it?
- refurb 10y ago
  Do you know what RICO stands for? It doesn't fit here.
  - trhway 10y ago
    why it is so hard for people to use Google? I mean it is right there https://en.wikipedia.org/wiki/Racketeer_Influenced_and_Corrupt_Organizations_Act#RICO_predicate_offenses https://en.wikipedia.org/wiki/Racketeer_Influenced_and_Corru... : " Under the law, the meaning of racketeering activity is set out at 18 U.S.C. § 1961. As currently amended it includes: ... Any act of ... theft, embezzlement, fraud, ... ..." Or do you really wanna argue that there wasn't a criminal "enterprise" as defined by RICO? I hope you aren't seriously considering to argue absence of the "pattern of the racketeering activity" here - that would be laughable. >Do you know what RICO stands for? It doesn't fit here. So, why would you say that RICO doesn't fit here? Or may be you just didn't know what RICO stands for?
hvmonk 10y ago
Senator Elizabeth Warren's questioning at the hearing is worth watching: https://www.youtube.com/watch?v=xJhkX74D10M https://www.youtube.com/watch?v=xJhkX74D10M
- prewett 10y ago
  While I agree with her points, it seemed like she really was preaching rather than investigating (at least for the first five minutes that I watched). Her questions were leading questions of the yes/no variety where she already knew the answer. I think Stumpf needs to be held responsible beyond resigning (canceling his golden parachute would be a good start). But I think Senator Warren should either give a speech or ask honest questions, but not give a speech disguised by a veneer of questioning. Nothing personal against Senator Warren, I assume this is de rigeur for Senate hearings.
mixmastamyk 10y ago
My perception is that WF took a big turn for the worse ethics-wise when they merged with Norwest in Minneapolis. Never heard a negative word about them until that time.
- rsync 10y ago
  nitpick: Norwest actually purchased WF outright, but then adopted their name and branding.
  - mixmastamyk 10y ago
    Did it include a "brain transplant?" I thought that was the case but went to look it up and couldn't find any details.
Frogolocalypse 10y ago
Paywall.
gjolund 10y ago
Is he being prosecuted? Nothing will change until we show that white collar crime is still crime.
Rapzid 10y ago
I worked at Wells Fargo back in 2003. The emphasis on product bundling predates Stumpf and was attributed to Kovacevich when I worked there, and they were very proud of its effectiveness on the bank's bottom line. The unwanted accounts shenanigans were well in play when I started. I recall having to call branches to report this stuff and have accounts closed(phone bankers had some status back then at least, though I'm sure the branch managers ignored my whistle blowing). You might think sales doesn't have much to do with customer service(phone bankers) right? Wrong. Every customer contact was considered a sales opportunity. The primary goal of every call was not helping the customer, it was refering a product and getting them on the line with a sales rep for "more information"(cause who doesn't want more information?!). From memory our major KPI's were close rate, referrals, and call time. You pretty much needed to refer a product on most calls to hit your numbers, regardless of whether the customer actually needed/would benefit from it. That covers referral rate, but they tighten the close rate and referral rate screws separately on you. The goals they set were hard and getting harder at the time, but obtainable without gaming if you had no shame. Oh, gaming. Gaming was manipulating the system in any way. Opening accounts without proper customer consent was gaming. Other forms of gaming did not amount to fraud. Gaming was rife. My best friend at the time, and still long time friend to this day, worked in the phone bank as customer service for about a year before making it to the sales team down stairs. Sales was a bit better from what I understand; we both had nightmares about customer service. After he graduated from college he was promoted to Sales Manager. He informs me that, depressingly, some of the same managers are there to this day. While he was there a few of the managers including himself were on the lookout for gaming, the rest I hear were actively for whatever was necessary to meet team numbers. I doubt even the highest person at the center gave a shit; whatever it took to appear to be hitting the numbers C-Levels set to get those bonuses. My friend tells me he probably would have put a bullet in his head if he had not gotten out of there. P.S. I'm still a Wells Fargo customer and recent events will not change that.
- whitepoplar 10y ago
  Just curious--why do you still remain a customer of Wells Fargo?
  - 10y ago
vadym909 10y ago
That's a win? No Jail?
imh 10y ago
Just Four Months Ago, New Wells Fargo Chief Said No Changes in Sales Strategy [1]. Meet the new boss, just like the old boss. [1] https://theintercept.com/2016/10/12/just-four-months-ago-new-wells-fargo-head-said-no-changes-in-sales-strategy/ https://theintercept.com/2016/10/12/just-four-months-ago-new...

312 points by smaili 10y ago

My understanding is that they created a system of unrealistic expectations as far as accounts per customer, had managers from the top that pushed this on people and they got fired. Then, in the case where employees started reporting that they were forced to do the activity to keep their jobs, nothing was done. This seems more like a lever that can be pulled here: Prevent banks from having ineffective whistleblowing processes by mandating use of a FINRA whistleblowing program. The person in the top comment being fired would get protected by Finra for her future employability, and Wells Fargo and other banks would take whistleblowing far more seriously. I admit it sounds very simplistic, but is there something crucial I'm missing here? I can't see how one would file charges at the top executives for "incompetantly making an internal ethics line" and "setting too difficult sales goals, causing an unintended fraudulent effect".

webaholic 10y ago

Go Elizabeth Warren! Without her prodding, I am sure this would never have happened. He was very happy with firing the 5k employees and not taking any blame on himself for what was essentially his push.

droopybuns 10y ago
Prodding? What investigating did she do?
- epistasis 10y ago
  What does investigating have to do with prodding? Meanwhile, she prodded pretty heavily in those congressional hearings...
- lobster_johnson 10y ago
  https://www.google.com/amp/s/www.yahoo.com/amphtml/news/how-elizabeth-warren-used-a-new-congressional-power-to-punish-wells-fargo-193310805.html https://www.google.com/amp/s/www.yahoo.com/amphtml/news/how-...
  - loeg 10y ago
    Ugh, Amp mucking with URLs. Real link: https://www.yahoo.com/news/how-elizabeth-warren-used-a-new-congressional-power-to-punish-wells-fargo-193310805.html https://www.yahoo.com/news/how-elizabeth-warren-used-a-new-c...
- Bud 10y ago
  Uh, she invented the entire fucking government agency that polices this crap, absent which, there would be nothing.
kaonashi 10y ago
I'll save my you go girl for when he's in jail.
shill 10y ago
I suspect Warren Buffet may have pushed for Stumpf's resignation/termination, as well as other damage control measures. This is a similar situation to the Solomon scandal, although Buffet has a smaller stake in WFC.
- bogomipz 10y ago
  Was WF one the banks he took a stake in after the 2008 crisis?
  - tedmiston 10y ago
    From an article last month [1]: > Berkshire Hathaway (BRKB) owns nearly 470 million shares of Wells Fargo (WFC), a 9.5% stake. Buffett also personally owns a little more than 2 million shares in the bank. The combined value of that investment has dropped by nearly $1.5 billion since Friday. I could see why he might be upset. [1]: http://money.cnn.com/2016/09/14/investing/warren-buffett-berkshire-hathaway-wells-fargo-fake-account-scandal/ http://money.cnn.com/2016/09/14/investing/warren-buffett-ber...
    - x0x0 10y ago
      I would also suggest Buffett is very focused on his reputation, and doesn't want to be seen tolerating behavior like this. From one of his letters to his managers: We can't be perfect but we can try to be. As I've said in these memos for more than 25 years: "We can afford to lose money — even a lot of money. But we can't afford to lose reputation — even a shred of reputation." We must continue to measure every act against not only what is legal but also what we would be happy to have written about on the front page of a national newspaper in an article written by an unfriendly but intelligent reporter. http://blogs.wsj.com/deals/2011/03/31/warren-buffett-on-ethics-we-cant-afford-to-lose-reputation/ http://blogs.wsj.com/deals/2011/03/31/warren-buffett-on-ethi...
    - bogomipz 10y ago
      Indeed, thats a lot of wealth that has evaporated in a short period of time. Interesting, from your link: "In fact, Berkshire Hathaway filed papers with the Federal Reserve this year for approval to boost its stake in Wells Fargo beyond 10%"

RKoutnik 10y ago

Meta: Looks like WSJ is smart enough now to detect the `web` links. I went directly to the site, hit paywall, backed out. Then went via the `web` link, same paywall. Went to `web` link in incognito, was able to read the (fairly anemic) article.

azhenley 10y ago
Interesting, the web link worked for me.
figers 10y ago
it's hit or miss, but I rarely have to do incognito for WSJ
- eric_h 10y ago
  I think they cookie you on the direct link hit, so going back and doing the web link doesn't work without incognito (IME).
  - tmm 10y ago
    I get the paywall, even in incognito across all browsers. They must also be tracking by IP.
    - eric_h 10y ago
      Fascinating. I work at a large WeWork (hundreds of people, ~9 floors of a 12 story building in manhattan). I wonder if I'm silently benefitting from WSJ subscribers who work out of there causing our ips to be whitelisted for uncookied, google-referred views. Do you do most of your browsing from home?
eric_h 10y ago
Yeah, I've had to do incognito on the WSJ web links for a while now.
mjevans 10y ago

honkhonkpants 10y ago

Honestly I still don't understand why this organization continues to exist. Banks are chartered by the government for the purpose of safeguarding deposits. This bank was engaged in fraud on a huge scale. Their charter should be terminated.

sverige 10y ago
Too big to fail. 2008 wasn't that long ago, remember? If the big banks go down, a lot of politicians lose a lot of money.
- ianai 10y ago
  They should be broken up
- honkhonkpants 10y ago
  It doesn't have to fail. Its administration can be taken over by a purpose-built entity (or the army corps of engineers, who cares really) and all sales and marketing can be halted while everything is liquidated in an orderly fashion.
- ArkyBeagle 10y ago
  https://www.amazon.com/Fragile-Design-Political-Princeton-Economic/dp/0691155240 https://www.amazon.com/Fragile-Design-Political-Princeton-Ec... Read that then form an opinion.
phil21 10y ago
Fraud against themselves mostly. I think you'll find all the major retail banks had policies very similar to Wells Fargo. Wells Fargo was certainly the tall poppy, but I have friends who have worked there and at other similar banks in a retail banker role - they didn't think anything abnormal of the sales pressure at WF, just noted it was a bit more intense than what they were used to and actually generally found WF to be better to work for than the other majors. I would even go so far as to argue the vast majority of consumer service sales operates under such unsustainable models as well, which encourage if not outright imply fraud. Ask any retail cellular employee and they'll be able to tell you stories that sound identical to Wells Fargo. Cramming is the default state of the game, since "corporate" will always continue to ratchet up sales quotas until they are unachievable for most moral people. I think I'm mostly surprised anyone cares, it's been going on for a decade plus and this sort of stuff is an open secret among retail sales in many industries. Why is it only now being reported? Why is only Wells Fargo being singled out? I don't oppose your solution. I'm just curious who Wells pissed off or didn't pay off, that the other banks apparently did.

Bud 10y ago

Whatever. Will he get a nine-figure golden parachute like the other senior exec who just left? If not, this does not impress me. Will any of his earnings and bonuses be clawed back? If not, this does not impress me. What about the other execs responsible?

maxxxxx 10y ago
It will be a massive golden parachute. No doubt.
- endswapper 10y ago
  "Financial details of Stumpf's retirement plan are unknown, but Equilar estimates he walks with $134.1 million from retirement. The package remains that large even after Stumpf last month agreed to a $41 million clawback following a grilling he received from the Senate Banking Committee reprimanding him for not taking responsibility. He agreed to give up unvested stock, but still owns shares vested in previous years.[0]" [0]: http://www.usatoday.com/story/money/markets/2016/10/12/wells-fargo-ceo-retires-under-fire/91964778/ http://www.usatoday.com/story/money/markets/2016/10/12/wells...
  - carsongross 10y ago
    How do you "give up" unvested stock?
    - vkou 10y ago
      Get fired or quit before it vests. (Conditional on your contract.) Edit: If you are a C-level executive, your contract may stipulate that you get unvested stock, even if you're fired. It's possible that John Strumpf chose not to exercise any such clause, but I strongly doubt it. The man is a psychopath.
      - carsongross 10y ago
        Right, but that seems like it's being extremely deceptive: when you quit or get fired you stop vesting. It isn't clawed back in any meaningful way. When you or I leave a startup, we don't talk about our unvested options getting "clawed back".

tomrod 10y ago

I would expect no less. Given the size of the issue, it's virtually impossible that he didn't know about it. I'm assuming competency here, as he was leading one of the largest banks in the world.

dbg31415 10y ago

Headline tomorrow, "John Stumpf Steps appointed chairman of the board of Wells Fargo."

miguelrochefort 10y ago

Shit's about to go down.

Smerity 10y ago

I highly recommend listening to a recent episode[1] of Planet Money. This was by no means an accident. As a short summary of one employee's plight: Ashley, working for them and making only $35k per year in San Francisco, was continually harassed to sign people up for accounts they didn't want. An old man comes in, pensioner, $200 in overdraft fees due to being duped into excess accounts. She dips into her own savings to get him back in the black. She reports the incident to the internal ethics line. Nothing. Tries again. Nothing. She refuses to fraudulently push excess accounts onto people. Fired. Worse, Wells Fargo put her onto a permanent blacklist that others in the industry pay attention to - she can't get a job anywhere else. Imagine making $35k per year in San Francisco - insanely low given the region - and dipping into your own pockets to help fix a situation your own company created. Then, as thanks, being eventually fired by that company for not continuing the practice and being blacklisted in your field of work. I'm desperately hoping Ashley sues Wells Fargo in a defamation suit but I fear the likelihood of that is low - even if it's not the first time it has happened to Wells Fargo[2] ... At best, upper management were willfully negligent of the impact that their insane sales goals had on the ethics of the company. At worst, upper management were actively trading any ethical notions they could get hold of for money, ripping apart the lives of employees and customers on the way. [1]: http://www.npr.org/sections/money/2016/10/07/497084491/episode-728-the-wells-fargo-hustle http://www.npr.org/sections/money/2016/10/07/497084491/episo... [2]: http://www.forbes.com/sites/billsinger/2011/12/15/wells-fargo-hit-with-punitive-damages-in-finra-u5-defamation-case/#225a6d7d7af1 http://www.forbes.com/sites/billsinger/2011/12/15/wells-farg...

hilop 10y ago
"permanent blacklist"? That sounds like the High Tech Employees Lawsuit case, but a much easier win for a more sympathetic class of victim.
- newjersey 10y ago
  Not to be overly dramatic but I would imagine it depends on who the jury sympathizes with.
  - 10y ago

erickhill 10y ago

I'm surprised no individuals at the executive level have been charged with crimes, to be honest. Or perhaps it's simply too soon and that's the next shoe to drop.

cloudjacker 10y ago
Surprised, he says
Kalium 10y ago
It takes time, effort, and care to build a strong case against a senior executive. Not something that can be done overnight.
- ethanbond 10y ago
  Definitely. That's why we're going on, what, almost ten years since the collapse with barely any real repercussions for any senior financiers in the county! We've just gotta be more patient... It'll happen.
  - Kalium 10y ago
    And sometimes there are no senior executives who did anything clearly identifiable as criminal under the laws at the time. Just because something terrible happened doesn't mean it's provably criminal and the fault of particular people.
ianai 10y ago
It does take a while. I don't think anyone was prosecuted for the Great Depression until about 10 years later, IIRC.
the_watcher 10y ago
It takes a shockingly long time to get to the point where you can file criminal charges. IANAL (but I did go to law school) but you need time to, at minimum, decide which charges to file (and ensure there are no jurisdictional issues), where to file them, talk to witnesses, file requests for documentation, etc. On top of all that, if you don't dot your i's and cross your t's perfectly, a judge could dismiss the case.

GCA10 10y ago

Bravo to the directors for waking up. Any time there's a long-serving CEO of a big public company, it's as if the directors have been chloroformed. They generally show no ability to question the boss, let along hold him/her accountable for anything. Most of the other boards that should be waking up ... probably won't. But at least they've got a reminder that it's possible.

infinite8s 10y ago
He's also chairman of the board. Not sure if he's relinquishing that role.
- dredmorbius 10y ago
  I'm pretty sure he is. Though NYT doesn't quite say so directly. http://www.nytimes.com/2016/10/13/business/dealbook/wells-fargo-ceo.html?ref=business http://www.nytimes.com/2016/10/13/business/dealbook/wells-fa...

jackmott 10y ago

Why isn't anyone in jail again? We will choke a guy to death for selling cigarettes incorrectly, and can't put people stealing millions in jail.

jhou2 10y ago
Well, apparently in America, it helps to not be black.
- Mao_Zedang 10y ago
  rich
- deleted 10y ago
  [deleted]
- a3n 10y ago
  If Stumpf were black we'd be reading the exact same story.
  - MaysonL 10y ago
    cf. the career of Richard Parsons, CEO of Citigroup: https://en.wikipedia.org/wiki/Richard_Parsons_(businessman) https://en.wikipedia.org/wiki/Richard_Parsons_(businessman)
- gjolund 10y ago
  The race war is just a distraction from the class war.
ljk 10y ago
money, power, connection, take your pick
deleted 10y ago
[deleted]
thrill 10y ago
This is why the management involved is unlikely to see prison: https://www.opensecrets.org/orgs/recips.php?id=D000019743 https://www.opensecrets.org/orgs/recips.php?id=D000019743

rm999 10y ago

Non-paywalled article with basically the same information: https://www.washingtonpost.com/news/business/wp/2016/10/12/wells-fargo-ceo-to-retire-in-wake-of-sham-accounts-scandal/ https://www.washingtonpost.com/news/business/wp/2016/10/12/w...

saintwind 10y ago

Here's the archive link, if anyone needs it: http://archive.is/BqWYq http://archive.is/BqWYq

carsongross 10y ago

Until the headline reads "Wells Fargo CEO John Stumpf Goes To Jail", nothing changes.

lazaroclapp 10y ago
I would be fine with "Wells Fargo CEO John Stumpf Ordered to Pay Back Fraudulent Fees to Wells Fargo Clients, Out of Own Pocket" (possibly down to some wealth limit, say, he can keep the $35K he apparently pays to his employees if his fortune is not enough to restore the damage). I am not a big believer in jail as punishment (as opposed to "place we keep people who are dangerous to others, for the good of society at large"). The remedy to fraud should be a fine, but it should be a fine commensurate with the level of fraud rather than a slap on the wrist and it should affect the people involved, not just get passed down to corporate stockholders (which includes pension funds and the like). I would also be fine with a court injunction banning him from working on banking, again, not as punishment but as "this man can't be trusted by society to handle other people's money". All of this after proper trial, of course. That said, bank CEOs are a Least Concern species when it comes to overuse of punishment in the justice system, so if someone wants to jail them until we decide not to jail many other types of non-violent offenders, well... I am not fighting that one too strongly. I just think that in one way it would be a step in the wrong direction.
- carsongross 10y ago
  Punishments need to be out of proportion to the financial damages they do when they erode public trust, which is a good held in common (and the key to prosperity in the west). This is why someone who runs a charity scam should be punished more than someone who simply mugs people.
  - will_pseudonym 10y ago
    Punishments should always be greater than the financial damages, because otherwise the expected value of fraud will always be positive.

ourmandave 10y ago

A previous article said he could leave with $200M which is not a golden parachute but built up over 30 years of working there. This article says they could take back $41M in stock options, another $4M in bonuses, and probably $20M in 2016 pay. (They paid him $19.3M in 2015.) $200M - $65M = f*ck me

st3v3r 10y ago

He's still not actually being punished. He lost his job. Big deal; he's got a golden parachute. He's not going to go through any of the stress that any of the people he fired for this went through when they lost their jobs. He's not getting fined, he's not going to jail. The worst thing that happened to him is he got a tongue lashing from Warren.

Bud 10y ago

#downvotedwhiletrue

azernik 10y ago
Being downvoted is usually temporary (random noise, until the upvoters a arrive). Comments complaining about being downvoted - which, note, are against site guidelines usually last longer. Don't write them. > Please resist commenting about being downvoted. It never does any good, and it makes boring reading.
- Bud 10y ago
  You're right. I apologize.
sctb 10y ago
We detached this subthread from https://news.ycombinator.com/item?id=12696763 https://news.ycombinator.com/item?id=12696763 and marked it off-topic.

suprgeek 10y ago

What is not mentioned in the very thin article is that this scumbag who ruined many people's lives gets to walk-away with $134 Million [1]. [1] http://www.usatoday.com/story/money/markets/2016/10/12/wells-fargo-ceo-retires-under-fire/91964778/ http://www.usatoday.com/story/money/markets/2016/10/12/wells... Yet if a common man had committed any of the fraud - they would be very likely in jail.

ArkyBeagle 10y ago

I watched a lot of his testimony before the Financial Services Committee on CSPAN. So I am unsurprised. He took a fairly savage beating. For some reason, the fact that Wells Fargo is a really big enterprise cut no ice with the various Congresscritters. FWIW, I am not a "break up the banks" guy[1] mainly because of things written and said in podcasts by Charles Calomiris, author of "Fragile By Design" along with Stephen H. Haber. It is all more nuanced and complicated than that, and the small bank lobby in the US really is a thing and a thing that has caused problems. [1] Canada has very close to only one bank and has had no financial crises to speak of.

Cretin1 10y ago
"Canada has very close to only one bank.." That's not even close to accurate: https://en.wikipedia.org/wiki/List_of_banks_and_credit_unions_in_Canada#Schedule_I_banks_.28domestic_banks.29 https://en.wikipedia.org/wiki/List_of_banks_and_credit_union... https://en.wikipedia.org/wiki/List_of_banks_and_credit_unions_in_Canada#The_.22Big_Five.22 https://en.wikipedia.org/wiki/List_of_banks_and_credit_union...
- ArkyBeagle 10y ago
  I'm a bit out of date - the top three ( of the Big Five ) still dominate, though: https://en.wikipedia.org/wiki/Big_Five_%28banks%29 https://en.wikipedia.org/wiki/Big_Five_%28banks%29 RBC was biggest by quite a margin and for a long time.
st3v3r 10y ago
" He took a fairly savage beating." He got a tongue lashing. He still has not faced any real consequences for what he did. "For some reason, the fact that Wells Fargo is a really big enterprise cut no ice with the various Congresscritters." Why would that excuse any of it? He's paid ungodly sums of money to be in charge of the company, and be responsible for it. If he can't handle it, then he does not deserve that money.
- ArkyBeagle 10y ago

partycoder 10y ago

The apology didn't work and clients started demanding accountability. I am glad this happened.

maxerickson 10y ago

I just got a robocall painting the CFPB as anti-consumer and a waste of tax dollars.

bogomipz 10y ago

I Couldn't read the article because of paywall. Is there any news on Carrie Tolstedt the woman who oversaw the unit that created all the fraudulent accounts and gets to retire in July at age 56 with a $124 million pay package? This in addition to the $9 million dollar she took home last year. http://money.cnn.com/2016/09/12/investing/wells-fargo-fake-accounts-exec-payday/ http://money.cnn.com/2016/09/12/investing/wells-fargo-fake-a...

pessimizer 10y ago

The USA Today headline is better: "Wells Fargo CEO Stumpf retires with $134M"

tlogan 10y ago

The title should be: "Stumpf gets with $134M"

slantedview 10y ago

Elizabeth Warren deserves a lot of credit for putting the heat on Stumpf. Coincidentally, one of the leaked Democratic e-mails from this week features banking lobbyists complaining to Democratic party officials about Warren: https://theintercept.com/2016/10/11/warren-goldman-dccc/ https://theintercept.com/2016/10/11/warren-goldman-dccc/ The apparent coziness between the party and the banks is a whole other can of worms, but that Warren doesn't hesitate to go against the party grain and attack folks like Stumpf is a nice thing to see. Good on her.

evanpw 10y ago

Let me just link to Matt Levine's take: https://www.bloomberg.com/view/articles/2016-09-09/wells-fargo-opened-a-couple-million-fake-accounts https://www.bloomberg.com/view/articles/2016-09-09/wells-far.... TL/DR: The bank probably didn't benefit on net from the fraud, even before the fines. This is more a case of management setting unreasonable sales goals and creating a terrible work environment than a conspiracy to commit fraud against bank customers.

chirau 10y ago
Did you read @Smerity's top comment above?
Neeek 10y ago
I thought the point was that it benefited Strumpf's pocket by falsely inflating share value, not necessarily the bank.

USANEEDSHELP 10y ago

He needs step down, off of a prison bus into a prison. So should the upper management and all of the people that committed this fraud, got away with it and are still employed by Wells Fargo.

JumpCrisscross 10y ago

The New York Times this morning about his supposed successor: "As chief administrative officer from 2010 to 2011, however, Mr. Sloan’s role included overseeing Wells Fargo’s human resources and reputation management. He then became finance chief for three years. And one of his direct reports when he was promoted to chief operating officer last year was Carrie Tolstedt, who ran the offending community-banking division until earlier this year. That makes Mr. Sloan a member of the inner circle that would have known about the wrongdoing from its early days and tried to deal with it. This group hardly covered itself in glory: It was still handing out pink slips in 2016, five years after the first bankers were shown the door. Mr. Stumpf and Ms. Tolstedt have already ceded compensation for the mess. Investigations by the board and regulators may yet implicate Mr. Sloan and others." http://www.nytimes.com/2016/10/12/business/dealbook/wells-fargos-heir-apparent-has-ties-to-scandal.html?em_pos=small&emc=edit_dk_20161011&nl=dealbook&nl_art=9&nlid=65508833&ref=headline&te=1 http://www.nytimes.com/2016/10/12/business/dealbook/wells-fa...

trhway 10y ago

he directed and benefited from massively organized criminal activity - it looks like a RICO case, isn't it?

refurb 10y ago
Do you know what RICO stands for? It doesn't fit here.
- trhway 10y ago
  why it is so hard for people to use Google? I mean it is right there https://en.wikipedia.org/wiki/Racketeer_Influenced_and_Corrupt_Organizations_Act#RICO_predicate_offenses https://en.wikipedia.org/wiki/Racketeer_Influenced_and_Corru... : " Under the law, the meaning of racketeering activity is set out at 18 U.S.C. § 1961. As currently amended it includes: ... Any act of ... theft, embezzlement, fraud, ... ..." Or do you really wanna argue that there wasn't a criminal "enterprise" as defined by RICO? I hope you aren't seriously considering to argue absence of the "pattern of the racketeering activity" here - that would be laughable. >Do you know what RICO stands for? It doesn't fit here. So, why would you say that RICO doesn't fit here? Or may be you just didn't know what RICO stands for?

hvmonk 10y ago

Senator Elizabeth Warren's questioning at the hearing is worth watching: https://www.youtube.com/watch?v=xJhkX74D10M https://www.youtube.com/watch?v=xJhkX74D10M

prewett 10y ago
While I agree with her points, it seemed like she really was preaching rather than investigating (at least for the first five minutes that I watched). Her questions were leading questions of the yes/no variety where she already knew the answer. I think Stumpf needs to be held responsible beyond resigning (canceling his golden parachute would be a good start). But I think Senator Warren should either give a speech or ask honest questions, but not give a speech disguised by a veneer of questioning. Nothing personal against Senator Warren, I assume this is de rigeur for Senate hearings.

mixmastamyk 10y ago

My perception is that WF took a big turn for the worse ethics-wise when they merged with Norwest in Minneapolis. Never heard a negative word about them until that time.

rsync 10y ago
nitpick: Norwest actually purchased WF outright, but then adopted their name and branding.
- mixmastamyk 10y ago
  Did it include a "brain transplant?" I thought that was the case but went to look it up and couldn't find any details.

Frogolocalypse 10y ago

Paywall.

gjolund 10y ago

Is he being prosecuted? Nothing will change until we show that white collar crime is still crime.

Rapzid 10y ago

I worked at Wells Fargo back in 2003. The emphasis on product bundling predates Stumpf and was attributed to Kovacevich when I worked there, and they were very proud of its effectiveness on the bank's bottom line. The unwanted accounts shenanigans were well in play when I started. I recall having to call branches to report this stuff and have accounts closed(phone bankers had some status back then at least, though I'm sure the branch managers ignored my whistle blowing). You might think sales doesn't have much to do with customer service(phone bankers) right? Wrong. Every customer contact was considered a sales opportunity. The primary goal of every call was not helping the customer, it was refering a product and getting them on the line with a sales rep for "more information"(cause who doesn't want more information?!). From memory our major KPI's were close rate, referrals, and call time. You pretty much needed to refer a product on most calls to hit your numbers, regardless of whether the customer actually needed/would benefit from it. That covers referral rate, but they tighten the close rate and referral rate screws separately on you. The goals they set were hard and getting harder at the time, but obtainable without gaming if you had no shame. Oh, gaming. Gaming was manipulating the system in any way. Opening accounts without proper customer consent was gaming. Other forms of gaming did not amount to fraud. Gaming was rife. My best friend at the time, and still long time friend to this day, worked in the phone bank as customer service for about a year before making it to the sales team down stairs. Sales was a bit better from what I understand; we both had nightmares about customer service. After he graduated from college he was promoted to Sales Manager. He informs me that, depressingly, some of the same managers are there to this day. While he was there a few of the managers including himself were on the lookout for gaming, the rest I hear were actively for whatever was necessary to meet team numbers. I doubt even the highest person at the center gave a shit; whatever it took to appear to be hitting the numbers C-Levels set to get those bonuses. My friend tells me he probably would have put a bullet in his head if he had not gotten out of there. P.S. I'm still a Wells Fargo customer and recent events will not change that.

whitepoplar 10y ago
Just curious--why do you still remain a customer of Wells Fargo?
- 10y ago

vadym909 10y ago

That's a win? No Jail?

imh 10y ago

Just Four Months Ago, New Wells Fargo Chief Said No Changes in Sales Strategy [1]. Meet the new boss, just like the old boss. [1] https://theintercept.com/2016/10/12/just-four-months-ago-new-wells-fargo-head-said-no-changes-in-sales-strategy/ https://theintercept.com/2016/10/12/just-four-months-ago-new...