In 2016, Wells Fargo CEO John Stumpf spent many hours testifying before Congress about the scandal that had just been uncovered, and the dark sides of the “financial mirror” were gradually exposed to the public.
An employee revealed to the press that her sales were subjected to up to 8 savings and credit accounts… per day. Not to mention in year-end sales campaigns, Wells Fargo employees are required to earn more than 20 new accounts every day. “We can barely live with this pressure, my stomach tightens every time we step into the office.”
Erik, an employee at the Wells Fargo headquarters, describes his work environment: “The constant pressure every day, day in, day out. It’s like a slaughterhouse.”
Every morning, all employees must meet with their team manager in the conference room to talk about a “solution goal”. Each loan or credit account is called a “solution”, and from morning to night, every employee is reminded by his manager: selling solutions, selling solutions …
“There have been many times I’ve seen employees collapsed under the sales pressure”, Erik said, “tears, crying, they are constantly dragged into the closed meeting room to” train “more. And those trainings are nothing but threats and pushes to increase sales.
“As a supervisor was called up this room,” another employee said, “Sitting in front of a large desk, not a window, door closed slammed and locked”. The manager then gives employees a “Reminder Minutes” and makes them sign on the spot, accompanied by a deterrent: “If you do not achieve sales, you will immediately be fired and stained. This will save forever in your career. “
This is almost a nightmare for young employees, especially when they have just witnessed the biggest financial crisis of their life.
An unnamed employee said he was so shocked that he vomited into the trash can in the meeting room. Erik thinks of his job as an abusive relationship.
1.5 million bank accounts, 565,000 credit accounts have been opened “short”. A series of employees across branches nationwide stole customer information to ensure sales, these employees also used contact information of personal or relatives to avoid detection.
Some employees even “run targets” by transferring customers’ deposits to many newly created accounts. Or “creating” furthermore open “free” accounts for the homeless.
After the incident was uncovered by the Los Angeles Times, Wells Fargo was fined a total of more than $ 185 million in 2016 for nearly 2 million “false” accounts created between 2011 and 2016.
By the end of 2016, the number of fake accounts discovered increased to nearly 3.5 million. Nearly 5,300 employees involved in the scandal were also quickly fired.
Incumbent CEO John Stumpf confiscated more than $ 41 million in personal shares, returned the 2016 bonus and did not receive a salary until approved by the court.
The above disaster once again proved the classic principle of Warren Buffet: “Employees who only know sales will sometimes be tempted by sales.”