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Wells Fargo is an American multinational financial institution that has served the highest number of communities over many years. For a long time, Wells Fargo had an excellent reputation due to its proper management and good cultural and economic models; recently, it encountered a toxic sales culture that severely affected its operations. The toxic sales culture and account fraud scandal experienced in this company occurred when its employees opened unofficial and illegal accounts and issued debit and credit cards without the customer’s consent.
Toxic Sales Culture
The Toxic Sales Culture experienced in Wells Fargo resulted from the increased pressure in culture sales at the bank, which made workers deceive their clients by opening unauthorized accounts (Arnold, 2016). The company’s employees explained that they were subjected to intense pressure, with the company expecting very high sales of up to twenty products in a day. Other employees explained that there were more crying and high levels of stress that made employees vomit and severe panicking (Arnold, 2016).
Wells Fargo’s toxic culture and account fraud had multiple effects on the customers and the company. The credit scores of the customers, for instance, were hit by the illegal accounts. The bank also prevented the customers from conducting legal banking practices since they had to enter into an arbitration with the bank (Tayan, 2019). This scandal affected all stages of management in this company from the senior executive to the bankers. Setting of high goals and over expectations by the company from the employees played a significant role in causing this problem.
This institution’s intense pressure made at least one employee consume hand sanitizer to deal with the stress. Other employees also described that the calls to the hotline of the company’s department of ethics we not reacted upon together with the termination of the contracts of those making the calls. Additionally, ethical hotline calls were never recognized, with some leading to employee termination (Tayan, 2019).
During this fraud period in Wells Fargo, some branch managers were exposed to difficulties in gaining employment in other banks (Mumley, 2019). The problem arose since banks always provide the U5 documents to the employees leaving; this document entails a record of delinquency and immoral conduct. In this case, Wells Fargo indicated in their insulting U5 documents that those employees were responsible for the creation of the illegal accounts (Mumley, 2019). The involved employees have hence put more blames and disappointments on this action since they worked under instructions.
To compensate for the fired employees’ gaps, Wells Fargo established a distinct group that was tasked to rehire employees who earlier quit the bank but had not been involved with the fraud. The banks, therefore, went for the option of hiring 1000 former employees whose contracts had been terminated wrongfully together with those who had to resign as a result of the fraud. The rehired employees were not those who participated in the establishment of an illegal account. The fired employees are however not contented with this situation as they claim that they were under instructions and pressure from their seniors.
Account Fraud Scandal
The account fraud scandal in this company is a current controversy that was caused by the creation of massive fraudulent savings, together with checking accounts for the customers of Wells Fargo without their knowledge. The information of account fraud became popular back in 2016 when the company was fined by various regulatory bodies such as the Customer Financial Protection Bureau because of this illegal practice. The clients noticed this fraud, having been charged unexpected fees and receiving unanticipated credit or debit cards. Various blames made on the company’s workers, managers, incentives of sales, and a high-level management team. This controversy led to multiple company changes, such as the resignation of its CEO, among other reforms (De Pascalis, 2018).
Cross-selling is the practice that underpins the fraud in Wells Fargo. It refers to selling various commodities to customers, for example, encouraging a customer to have a checking account to take out a loan or instead set up online banking accounts. Previously, Wells Fargo was considered the most successful cross-seller when the success of retail banks was measured.
The company’s employees were instructed to order credit cards for pre-approved customers without their knowledge and consent. They were also encouraged to use their customer’s information when they were filling the request; this aimed to prevent the customers from realizing the fraud. The employees of this company also created fake savings and checking accounts, which is a process that involves transferring money out of valid statements. These additional products were made possible by setting the pins of customers to 0000, thus enabling the bankers to control their clients’ accounts and registering the clients in other programs such as online banking.
Employees took various measures of satisfying quotas, such as enrolling the homeless in the fee-accruing financial services. The reports on an investigation of the fraud concerning unreachable goals and inappropriate employee conduct to the supervisors did not find changes to expectations.
Employees of Wells Fargo later issued unwanted insurance policies. Among the unwanted insurance policies issued included life insurance policies by the Prudential Financial, together with renter’s insurance policies. Employees of this company were later fired by the prudential claim that it could seek damages from the company; both the junior and senior employees got fired despite the fact that it was those from senior jobs that put more pressure on the juniors. (Tayan, 2019).

`The toxic culture of sales and account fraud in Wells Fargo severely tarnished the company’s reputation. This controversy has much-instilled fear among this company’s customers since their banking information is not secure as they thought. This fear has many people and various states like California to cut its relationship with the bank. Many customers have opted to move their shares to other financial institutions. The company has also faced a series of investigations and charges that have caused a lot. In response to this problem, the company has made various attempts aimed at regaining its initial image. The company has done this by setting a realistic and achievable goal, thus preventing pressure among its employees. The company has also rebranded itself by, for example, launching a marketing campaign that is incorporated aimed at convincing customers of its commitment as well as establishing trust in their potential customers. Despite all these measures, the company has faced new allegations, such as signing up unsuspecting customers for superfluous insurance policies. It has also faced an inquiry into the sales activities employed by the company’s financial advisors.

Arnold, C. (2016). Former Wells Fargo employees describe toxic sales culture, even at HQ. NPR. October 4.
De Pascalis, F. (2018). Sales Culture and Misconduct in the Financial Services Industry: An Analysis of Cross-selling Practices.
Mumley, W. E. (2019). Organizational Culture and Ethical Decision-Making During Major Crises. The Journal of Values-Based Leadership, 12(2), 9.
Tayan, B. (2019). The Wells Fargo cross-selling scandal. Rock Center for Corporate Governance at Stanford University Closer Look Series: Topics, Issues, and Controversies in Corporate Governance No. CGRP-62 Version, 2, 17-1.