During the past year Wells Fargo, a well-recognized bank of the United States, has been trying to clean its name and the mess it got itself into, when it was brought to the public that the bank was involved in generating fraudulent checking and savings accounts for its clients without their knowledge or their authorization. “The way it worked was that employees moved funds from customers' existing accounts into newly-created ones without their knowledge or consent” Wells Fargo set an unattainable goal for their employees and this caused that most of them enrolled in unpractical procedures in order to achieve the target that was set. in order to do that, employees used every resource they had and ended up creating fake paperwork and opening …show more content…
Fear of Conflict and Artificial Harmony It appears that, when employees who were responsible for sales, could not achieved the desired goals, preferred not to say anything and instead, enroll in unethical behaviors such as opening accounts without the client’s approval. It seems that they decided to handle the situation the way they did because they did not feel comfortable about speaking up and addressed the problems to their supervisors. I looked like they kept silence because they did not want to create any problems or conflicts and preferred to maintained the artificial harmony established within the company. All this behavior led to believe that the whole problem started not with the fear of conflict but with one dysfunction lower, Absence of trust. How do we expect that the employees feel comfortable about speaking up about how they feel and the things they do not feel good about if they don’t trust their supervisors or even their …show more content…
The Bank also said that they are going to refund the money to all the customers that were affected by the fraud and that they are also willing to pay all the penalty fees. In my opinion, giving the clients, their money back is a good start good but that is only an external fixture. In order for them to fix the problem from the root, they need to work on it internally too. Obviously, the CEO had a very important part in the problem. He was supposed to keep track of everything and should have seen that something was not right a long time ago. Also, the company needs to come up with a new sale strategy and set S.M.A.R.T. goals for the long and short run and reevaluate these decisions based on the outcomes. Wells Fargo needs to implement a system in where employee's ideas can be heard. They need to feel comfortable enough to speak up their minds and give their opinions and that their opinions are going to be taken into consideration for future decisions.
Based on the contingency continuum theory the bank was on the pure accommodation side by doing full apology, by being honest and communicating it to the public. " Stumpf, who will testify at the Sept. 20 hearing, said he was sorry about the scandal. “We deeply regret any situation where a customer got a product they didn’t request,” Stumpf said during an appearance on CNBC’s “Mad Money” on Tuesday." (Puzzanghera, 2016). Then, always following the apology and restitution strategy Wells Fargo put his public first by doing paying full compensation to them. According to Egan, Wells Fargo has reached a $110 million preliminary settlement to compensate all customers who claim the scandal-ridden bank opened fake accounts and other products in their name. Furthermore, they also did some corrective actions by eliminations retail sales goals. “The elimination of product sales goals represents another step to reinforce our service culture, helps ensure that nothing gets in the way of our ability to achieve our mission and is consistent with our commitment to providing a great place to work,” he said. The sales goals will be eliminated starting Jan. 1, Wells Fargo said." According to Puzzanghera, 2016. Concerning, the corrective action the bank went beyond the elimination of retail sale goals they also fired some employees, paid their fined toward the regulatory bodies including the Consumer Financial Protection Bureau(CFPB) and the
Prior to Fuller’s transfer, management at the Carson’s location was poorly run using the classical approach. While this approach can be successful, management has to find a good middle ground between caring for the company and caring about their employees. A traditional classical approach recognizes that there are five important factors to running a successful business (Miller, 19). According to text, these factors are planning, organizing, command, coordination and control (Miller, 19-20). These factors can be seen when you look at Third Bank as a whole. In the study, the CEO saw the issues in his company and put a plan together to improve. He had meetings with management, like fuller, to organize a solution. He then commanded all locations
As a consumer I want to be able to trust that I can walk inside a well-known bank and not have to worry about the bank employees taking advantage of me. Over the years we keep on hearing about all these financial scams and almost all of the time it is the consumers who are affected and when the scam is brought to light, it is the lawyers who see a big payday. I choose this particular issue because I am tired of the little man, meaning us the consumers being affected the most by these scams. I would think that the millions of dollars in bonus money that these senior level executive make each year would be enough but no they are greedy sociopaths that takes advantage of people who have less than they do in order to become rich and
Top management is spending too much time on employee development and not enough on the overall strategy of the business.
For Tenth National Bank, we have reason to believe that the client intercepted the paper confirmation. After we sent the paper confirmation to the bank, we received an email from Lou Jennings stating that the bank forwarded the confirmation directly to their office instead of sending it to the audit team. In addition, Mr. Jennings provided login credentials and a link to the bank’s website, which did not appear to be reliable. As per the video, “How to Fight Confirmation Fraud”, presented by the founder of confirmation.com, Brian Fox, a fictitious website can be created easily. Our skepticism toward the reliability of the website is based on the unresponsiveness of most of the links on the site; the only link that works is the login button. In addition the website appeared dated and rudimentary. Another factor we found quite strange is that the website only offers paper statement deliveries, which we find highly unusual since paper statements are easier to modify. Furthermore, based on the tracking provided by USPS, the letter is still in the shipping process with no indication that Tenth National Bank has officially received the request for confirmation. This further supports our theory that Lou Jennings intercepted the Tenth National Bank confirmation letter. In our o...
in low service for clients and affected employee morale seriously, and the managers had to
In all the issue took about a month to resolve and the RBC gave customers 90 days to file claims with the bank. RBC also hired an adjuster to help with losses as a result of the problem and hired IBM to consult with the cause of the problem as well as how to prevent the problem from happening again.
First of all, they will not be able to buy tangible properties such as house, car and etc. because of that their credit ratings got a huge hit. Moreover, only 5,300 of the employees that were fired from the Bank, 10% were Managers. What could have motivated them to engage in this sham? This is not an attempt to imply all were of malicious but certainly most them led the way. The aggressive sales goals pushed employees to break the rules. “On average one percent 1 percent of employees have not done the right thing, and we terminated them. I don’t want them here if they don’t represent the culture of the company,” says John Stumpf, the company’s longtime chief executive, in an interview with The Washington Post. It is obvious that simple employees and managers could not break the law if someone from the top did not allow them to do so. But the executive board of Wells Fargo claimed that they only fired 1 percent of below employees and some managers for fraudulent accounts, however they also might be involved in that business crime although to build a case against a company executive, prosecutors would have to show “they knew there was a plan to create false accounts to drive up sales,” said Brandon L. Garret, a professor at the University of Virginia School of Law. Even if it appears that the executive purposefully attempted to avoid knowing about the fraud, prosecutors may be able to build a case. Because they don’t have to participate if there is willful
As Wells Fargo convicted all the requirements of fraud they are involved to the business crime called fraud, they are liable to their fraud crime. There was a false statement which respectively conducted to the injury to the alleged victim as a result. Wells Fargo has been ordered to pay $185 million in fines, but that's a pittance compared with the $5.6 billion the bank earned in just the second quarter of this year. Meanwhile, the bank's victims weren't just nickel-and-dimed with overdraft and maintenance fees. Many of them took "significant hits" to their credit scores for not staying current on accounts they did not even know about. They will likely have difficulty securing home and car loans at reasonable rates for years to come, simply because their bank decided to defraud
Third Star Financial Services is an “un-banked” business that was built from a foundation of several money transfer operations that can be transact through an agent or an online facility since 1996. Third Star’s goal and objective is to develop and implement an enterprise architecture platform for the organization that is more streamlined and leaned with consistent policies and procedures throughout the company. A consolidated, centralized and standardized single version of the business structure and a modernize technology that can provide ease and flexibilities to their new and existing customers, in addition to their support staff and management teams.
A Review of Management Techniques and Practices at Wells Fargo Bank. Over the past 150 years, Wells Fargo Bank has become one of the largest financial institutions in the North America. Wells Fargo Bank is much more than a bank. It’s a premium financial service provider.
The Wells Fargo scandal started in 2016 when it came to light that starting back in 2011 employees created over 1.5 million fraudulent bank
HSBC has various risk and benefits with its tagline of the “World’s Local Bank.” Some of the risks they face are the delicacy of entering into a new area and process of how they enter into these markets. HSBC has to be very careful about what markets they try to enter. Coming into a small market with the tagline “World’s Local Bank,” may be taken the wrong the way. I know from experience, especially in my town and surrounding area that when a large well known bank comes in that the local small banks take a hurt. Though some people leave these small banks to join the new ones a majority of people feel overwhelmed by the presence of the large banks. HSBC needs to be careful to do the necessary research before entering into a new market especially
Introduction Pramuka Savings and Development Bank (PSDB) was incorporated in 1997 as the first private savings bank in Sri Lanka. Mr. Rohan Perera was the founder of Pramuka Bank and was the founder and chief executive officer of Seylan Bank previously. After resigning from Seylan Bank, Mr. Perera applied for license to incorporate a commercial bank from Central Bank Sri Lanka. But Central Bank only gave license to operate a Savings and Development Bank. But that was also a debatable topic.
In this case study it was stated that there were a problem happen in the outsourcing for the Royal Bank of Scotland. What happen was there were an error that happen during the routine software upgrade that cause million of that bank customer cant access to their account. The error happen when one junior technician in India was accidently wiped all the information during the routine software upgrade. The member of staff that was working under the program for the Royal Bank of Scotland, NatWest and Ulster Bank and it was based in Hyderabad, India.