Wells Fargo Crooks Stole From Customers, Reaped Obscene Rewards—and Stuck Us With the Bill
“The business model of Wall Street is fraud,” Bernie Sanders proclaimed repeatedly on the stump. Wall Street’s big banks seem intent on proving his case. Most recently, Wells Fargo—whose CEO, John Stumpf, was celebrated as “banker of the year” by American Banker in 2013—has been fined $185 million for abusing its own customers. From 2011 to 2015, the company opened nearly 2 million bank accounts and more than 500,000 credit cards for customers who didn’t ask for them, engaging in fraud, identify theft, and forgery along the way. Its customers, as former Wells Fargo sales manager Beth Jacobson put it, were “all riding the stagecoach to hell.”
Wells Fargo executives touted the tactic of “cross-selling”: getting existing customers to buy the bank’s other products. To achieve this, executives set impossible quotas for sales personnel, called “team members.” Tellers and salespeople, often stuck in $35,000-a-year jobs, were told either to meet the quotas or lose their jobs. Bonuses were awarded to those who hit the sales targets—but the only way to meet them consistently was to cheat. When customers began to complain—after being charged fees for accounts they didn’t know they had, or seeing their credit ratings lowered for credit-card applications they didn’t know they’d made—the bank set up the proverbial “cover-your-ass” briefings with its salespeople: warning them not to cheat, but keeping the quotas in place. Under increasing scrutiny from regulators, Wells Fargo fired some 5,300 low-level employees—as much as 2 percent of its workforce—over a period of five years, claiming that the frauds had been committed by rogue team members.
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