WELL FARGO SCANDAL

Group 4

 Secretly issuing credit cards customers never asked for

Setting up fake bank accounts that resulted in customer fees
Creating fraudulent email accounts to sign up customers for
additional services
Actually transferring customers' money back and forth between
accounts, without permission
ACTION:
A FINE OF $185m TO CUSTOMERS AND CONSUMER FINANCIAL BUREAU, IN RESPONSE
TO ILLEGAL BANKING PRACTICES OF ITS EMPLOYEES
5,300 FARGO EMPLOYEES FIRED

REASONS:
Sales pressure from management was unbearable - "gr-eight
initiative -> at least eight financial products per customer
Practice ingrained in the culture -> everybody is doing it
Management was fully aware of this," but his bosses deliberately
"turned a blind eye -> no fear of being caught

POOR HR PRACTICES:
Role as advocates : Have their voice heard on issues that are
important to them
Defend and safeguard their rights
Lack of effective leadership
Ethics hotline

AFFECTS ON WELL FARGO:

Trigger a walkout of some existing customers , and ward off potential
ones.
Possible effects on securities licensing
Share price down by more than 10%, reaches a 2.5 years low