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Tuesday, March 26, 2019

Just when you thought that Big Banker greed surely bottomed out with 2008’s Wall Street crash and bailout, along comes Wells Fargo, burrowing even deeper into the ethical slime to reach a previously unimaginable level of corporate depravity.

It’s one thing for these giants of finance to cook the books or defraud investors, but top executives of Wells Fargo have been profiteering for years by literally forcing their employees to rob the bank’s customers. Rather than a culture of service, executives have pushed a high-pressure “sales culture” at least since 2009, demanding that front-line employees meet extreme quotas of selling myriad unnecessary bank products to common depositors who just wanted a simple checking account. Employees were expected to load each customer with at least eight accounts, and employees were monitored constantly on meeting their quotas — fail and they’d be fired.

That’s why the bosses’ sales culture turned employees into a syndicate of bank robbers. The thievery was systemic, and it was not subtle: Half a million customers were secretly issued credit cards they didn’t request; fake email accounts for online services were set up without customers’ knowledge; debit cards were issued and activated without telling customers; depositors’ money was moved from one account to another; signatures were forged — and, of course, Wells Fargo collected fees for all of these bogus transactions, boosting its profits.

This is not a case of a few bankers gone rogue, but of a whole bank gone rogue, rotting from the head down. Some stories of corporate villainy make me throw up my hands in astonishment. But this one is so putrid it makes me literally throw up.

The sorry, still-evolving saga of Wells Fargo systematically stealing from its small depositors is a gag-inducing story of executive-suite greed. Start at the very top, with CEO John Stumpf, who claimed at a recent Senate hearing on the scandal to be shocked and “deeply sorry” that thousands of his employees had been opening bogus accounts in the names of non-English-speaking and elderly customers.

Just when you thought that Big Banker greed surely bottomed out with 2008’s Wall Street crash and bailout, along comes Wells Fargo, burrowing even deeper into the ethical slime to reach a previously unimaginable level of corporate depravity.

It’s one thing for these giants of finance to cook the books or defraud investors, but top executives of Wells Fargo have been profiteering for years by literally forcing their employees to rob the bank’s customers. Rather than a culture of service, executives have pushed a high-pressure “sales culture” at least since 2009, demanding that front-line employees meet extreme quotas of selling myriad unnecessary bank products to common depositors who just wanted a simple checking account. Employees were expected to load each customer with at least eight accounts, and employees were monitored constantly on meeting their quotas — fail and they’d be fired.

That’s why the bosses’ sales culture turned employees into a syndicate of bank robbers. The thievery was systemic, and it was not subtle: Half a million customers were secretly issued credit cards they didn’t request; fake email accounts for online services were set up without customers’ knowledge; debit cards were issued and activated without telling customers; depositors’ money was moved from one account to another; signatures were forged — and, of course, Wells Fargo collected fees for all of these bogus transactions, boosting its profits.

The silver-haired bank chief assured senators that he and other top bosses knew nothing about this mass breach of the bank’s code of ethics, blaming low-level employees and firing 5,300 of them. But John, John, John: First, weren’t you the one squeezing those employees relentlessly to push customers into multiple accounts? Second, how could you possibly not notice a huge crime spree that rampaged throughout your bank’s branches for seven years? Third, what about all those calls that honest employees made to your “ethics hotline” taking place every day? And, fourth, while you now cravenly blame your $12-an-hour employees for this bank-run mugging operation, it turns out you read about it in a 2013 expose by The Los Angeles Times. Why didn’t you stop it then?

Stumpf didn’t act because he was busy stuffing his own pockets with the loot, hauling off more than $100 million in personal pay in the last four years alone. What a deal: Workers are pressured to rob customers, then they get fired, while the boss of the caper grabs a fortune and protects all the higher ups — and he expected to get away with it all by making a non-apology to some senators. [Editor’s note: Stumpf resigned from Wells Fargo, effective immediately, on October 12.]

But the chief is not the only one who should be held accountable at Wells Fargo. Where were its board members, who are empowered and duty-bound to set, monitor, and assure ethnical corporate behavior from the top down? For seven years, this 15-member board of governance sat idle, apparently incurious about their corporation’s flagrant, widespread thievery, even after the report by the LA Times exposed it. Far from investigating and clamping down, the board kept shoving multimillion-dollar bonuses at Stumpf and other top executives. This is a powerhouse board, made up of top executives from other corporations, former government financial officials and big-time academics. And they are extremely well-paid to be diligent, getting up to $400,000 a year to keep Wells Fargo honest.

What’s at work here is the ethical rot that now consumes America’s entire corporate system — a system that steals from the many to further enrich the few, buying off the integrity and vigilance of those who run it. Excuse me, but I have to go throw up now.

To find out more about Jim Hightower, and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate webpage at www.creators.com.

IMAGE: Wells Fargo CEO John Stumpf testifies before the House Financial Services Committee on Capitol Hill  in Washington, DC, U.S. September 29, 2016. REUTERS/Gary Cameron

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8 responses to “Wells Fargo: Stumpf Was Only The Tip Of Corporate Rot”

  1. dtgraham says:

    C’mon now Jim. Wells Fargo was just trying to give their customers some social standing, some confidence, and a reason to brag. The average Wells Fargo customer could confidently say that, “I don’t mean to brag but I have 10,000 in my Wells Fargo bank account.” The really good thing here was that if they were ever actually caught on it, they could always say, “sorry I meant to say that I have 10,000 Wells Fargo bank accounts, although I don’t actually have any money in any of them”.

    Thank god for unfettered, unregulated, free enterprise.

  2. RED says:

    Yep, and guess who believes whole heartedly in that corporate system? That the same people should set regulations because they know the industry? And that we are biased against successful people and we just don’t understand how complicated their lives are?

  3. FireBaron says:

    Ya gotta wonder at the chutzpah of someone who claims at a Congressional Hearing that thousands of Wells Fargo employees had the exact same idea at the exact same time to generate false accounts in the names of their customers. I realize that the vast majority of that committee has a collective IQ that may possibly reach three digits, but even they should be able to tell when a scam is being pulled on them to cover another scam. After all, they are masters at that sort of manipulation.

  4. johninPCFL says:

    Thank you Elizabeth Warren. Had she not fought tooth and nail with the GOP to get the financial services product safety commission running, WF would still be enabled to rob and steal. The free market approach? Once the theft is known (and the GOP-run Congress now has placed limits on how long it takes to “know” you’ve been robbed, and how long it may be “known” before action must be taken or you forfeit your rights), you are free to change banks and sue, at your own cost, of course. Otherwise, your only option is absorb the hit to your credit rating and pay back the stolen money from your own earnings.
    Thanks, GOP!!!
    Remember, one of Trump’s promises (and those in the GOP-run Congress) is to gut the FSPSC and render it inoperable.

  5. johninPCFL says:

    “This is a powerhouse board, made up of top executives from other corporations, former government financial officials and big-time academics. And they are extremely well-paid to be diligent, getting up to $400,000 a year to keep Wells Fargo honest.”
    This is a similar operation to the “compensation committees”, wherein other executives weigh in to determine how much CEOs should be paid. It’s another “good ole boys” club.
    What CEO is going to vote down a pay raise for a person serving on his own “compensation committee”?
    Similarly, what “board of governance” member is going to question Stumpf’s performance when doing so will get him fired from his cushy, “meet once a month in cool, exotic places at WF expense” paid board membership?

  6. iamproteus says:

    What do you suppose the odds are of any of these thieves ever seeing the inside of a prison cell or even having to give any of their ill gotten gains back to the people they stole it from? I would guess it to be on the order of slim to none! They will keep their fat bank and brokerage accounts.They will keep the expensive cars, planes and yachts along with the attendant drivers and pilots. They will continue to live in their MacMansions with their gardeners, servants, butlers, and cooks. Their wives will keep wearing their jewelry and furs and their kids will still get their educations at Harvard and Yale. That’s their definition of justice!

  7. MobeKoshay says:

    Why isn’t Stumpf, another “White Collar” criminal, in
    jail? I understand that Stumpf is still leaving Wells Fargo with a heap of
    money. Apparently, The Board of Director’s of Wells Fargo have no balls
    and should have refused to pay out the remainder of his contract and pressed
    charges against him. As a Banking Customer of Wells Fargo, I am furious
    of Stumpf exiting his former position at Wells with a ton of money!
    Customers of Wells Fargo should form an e-mail
    petition, via e-mail and pass it forward till it reaches several thousands
    of Customer’s signatures who have Wells Fargo banking accounts. In the
    petition, we demand that the Board of Director’s recoup the money
    that they agreed and allowed Stumpf to leave with by a certain date
    – if they refuse, then the vast number of signatures from people on that
    petition that bank with Wells Fargo will withdraw and
    close their accounts with Wells Fargo on that specified
    date! You’ll see how fast of a turnaround and a revision of future executive
    contracts are worded with addendums regarding causes of cancellation of
    their contracts with no monetary means of fulfilling their original reign

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