September 16th, 2016
(written by lawrence krubner, however indented passages are often quotes). You can contact lawrence at: firstname.lastname@example.org
So you might have bank accounts that you don’t want and you never asked for? You might be charged fees on these accounts? Reasonable people should find this terrifying:
If you Google the phrase “bank cross-selling,” you don’t get many hits about the recent Wells Fargo scandal, in which thousands of bank employees were fired for the most blatant sort of corporate fraud. “Team members,” as Wells Fargo prefers to call its employees, had strict mandates to sign existing customers up for additional products. Someone with a savings account should be convinced to open a checking account, get a credit card, transfer a 401(k), and maybe even take out a mortgage. The sales targets were so high that many employees found them impossible to meet, until someone hit upon an ingenious solution: ignore the customers’ wishes, as well as banking law and basic ethics, and open up new accounts even when the clients had asked them not to. In some cases, customers were charged late fees on accounts they hadn’t requested and that they didn’t know they had.
The core of the case against Wells Fargo has been well-known since a remarkable investigative report by the Los Angeles Times in 2013, and hints of the troubles were already apparent in a Wall Street Journal article in 2011. It took years, but now the company has been fined a hundred and ninety million dollars—a record, the Consumer Finance Protection Bureau says. More than five thousand employees were fired for the offenses. This practice was so widespread around the country that it would be a truly remarkable coincidence if each team member had come up with the strategy independently. Still, only low-level managers were fired. Once again, a big bank was caught doing something awful, received a fine, admitted no wrongdoing, and no senior manager or, God forbid, C.E.O. was punished in any way.