Unrealistic sale goals pushed 5,300 Wells Fargo employees to open over two million fake accounts without customers knowledge.
Since 2011 “Wells Fargo employees [have] secretly opened unauthorized accounts to hit sales targets and receive bonuses,” director of the C.F.P.B., Richard Cordray said in a CNN Money article.
Associate business professor at Columbia University, Dan Amiram told CNN Money, “if the managers are saying, ‘We want growth; we don’t care how you get there,’ what do you expect those employees to do? ”
To make it more believable, employees went as far as setting up fake email addresses as well as fake pin numbers. Although some customers noticed the unusual activity on their accounts, most were not aware of the unfolding scam.
Money would be transferred to open accounts, then when the customers confronted the suspicious activity employees would shut the accounts down and dismiss it. Customers would also be charged with unusual fees for signing up.
Even though the majority of Wells Fargo users were unaware of the fake accounts, the employees would routinely shut them down to avoid suspicion.
This is not the first problem Wells Fargo has encountered regarding unwanted accounts.
Last year, Californian Shahriar Jabbari filed a lawsuit against the company on behalf of “his credit score [that] had suffered because unpaid fees on the unauthorized accounts had been sent to a debt collector,” stated Jabbari in a New York Times article.
“These illegal banking practices cost Wells Fargo $185 million in fines, including a $100 million penalty from the C.F.P.B.,” explained author Michael Corkery in a New York Times article.
All the fraud certainly has cost the bank.
“At Wells Fargo, when we make mistakes, we are open about it, we take responsibility, and we take action,” the bank assured the public in a CNN Money article.
While Wells Fargo intends to pay everyone back Los Angeles City Attorney Mike Feuer explained that “consumers must be able to trust their banks.”