[Music]
we know that money doesn’t grow on trees
but Wells Fargo customers have found
that bank accounts do appear out of
nowhere it’s a bank right they’re
supposed to keep track of people’s money
safety security welcome to watchmojo.com
down five crucial facts you should know
about the Wells Fargo account scandal if
they really didn’t know then that tells
me this is a bank that is simply too big
to manage number five what is Wells
Fargo Wells Fargo is considered one of
the big four banks in the United States
along with JPMorgan Chase Bank of
America and Citigroup according to rel
banks Wells Fargo was the largest bank
in the world in 2015 in terms of market
cap operating in 35 countries and
serving over 70 million customers
worldwide
in fact Wells Fargo was ranked as the
seventh largest public company on the
planet by Forbes in 2016 the bank which
today is headquartered in San Francisco
has its origins in the mid 19th century
gold rush it was founded by Henry Wells
and William Fargo who were also part
founders of American Express in 1852 in
its early years Wells Fargo was one of
the few banks to survive the panic of
1857 which saw a collapse in the banking
system in recent years a series of
controversies has dogged the brand
including fines for overdraft issues
administered in 2010 allegations of
racial discrimination in 2011 inadequate
risk disclosures in 2012 and violations
of New York credit card rules in 2015 as
well as high-profile revelations in 2014
surrounding the earnings of executive
figures number four how was the fraud
committed in September 2016 it was
revealed that employees at Wells Fargo
had been covertly creating and operating
extra bank accounts without customer
authorization an investigation found
that at least one and a half million
bogus accounts and over half a million
credit cards had been open
since 2011 without customers knowledge
the fraud was committed as a means of
not only making more money for the bank
but more importantly to boost sales
figures so that employees involved could
reach quotas and qualify for incentive
bonuses it’s reported that in some
instances fake PIN numbers and email
addresses were used in order to sign
customers up for services without their
knowledge Wells Fargo has taken
responsibility for the problem which has
been blamed by some critics on the
incentives given to employees and also
seemingly results from inadequate
monitoring checks and control procedures
either they knew or they didn’t know
in which case how can you run a giant
multinational bank the bank has been hit
with 185 million dollars in fines 100
million dollars of which goes to the
Consumer Financial Protection Bureau
civil penalty fund and it’s been ordered
to pay a further five million dollars as
compensation to the customers affected
number three how did the scandal affect
customers in many cases the extra
accounts initially went unnoticed or
unquestioned by customers small amounts
of money were typically transferred from
an existing account when the fraudulent
new one was opened a transaction that
didn’t always draw attention as some
phony accounts were then closed within
weeks customers remained unaware that an
extra product had ever been added
however many people found themselves
receiving credit or debit cards in the
mail which they hadn’t asked for and
being charged fees for accounts they had
no idea existed in some extreme
circumstances it’s reported that
customers were contacted by debt
collection agencies in relation to
outstanding fees on unrecognized
accounts analysts suggest that the dupe
was made easier thanks to Wells Fargo’s
long-established reputation for cross
selling to existing customers the
company looks after banking loans
mortgages and credit cards and
reportedly places focus on selling
additional services to customers they
already have rather than capturing
brand-new clients
number two what has wells-fargo done to
fix the problem
though the bank has neither admitted nor
denied the accusations Wells Fargo has
agreed to pay the fines and is expected
to change sales practices and incentive
structures as a result at least 5300
employees have been fired since 2011 for
quote inappropriate sales conduct in
relation to the scandal and Wells Fargo
has promised to assume greater control
over and monitoring of customer service
in a memo sent to employees on September
8th 2016 the firm said when it makes
mistakes it is quote open about them and
also confirmed that it would quote take
action Wells Fargo has also begun
repaying all customers involved
reporting that five million dollars is
earmarked for remediation with 2.6
million already paid out the average
payment per customer is $25 the bank has
also stressed that it has refunded or
will refund any account where there is
the slightest suggestion of foul play
implying that summary payments have been
made for accounts that actually were
properly authorized number one what’s
next for Wells Fargo and banking in
America as one of the world’s largest
banks at the center of a high-profile
scandal Wells Fargo is set for a
difficult period as trust in the company
has waned however customers and analysts
are already using it as a case study for
problems with the US banking system in
general in the wake of the account
scandal Wells Fargo employees have
reportedly argued that mounting pressure
to meet sales targets is reason for the
false accounts so as long as the banks
are expected to grow it’s estimated that
similar issues could continue to arise
on the one hand banks face
ever-increasing target figures on the
other there are fewer and fewer people
to sell to which is why firms often look
to make more money out of the customers
they already have this problem doesn’t
excuse Wells Fargo’s underhanded tactics
but it does help explain the scandal as
individual refunds remain relatively low
perhaps the most shocking aspect of this
story is that over 5,000 individual
employees were prepared to con customers
and participate in fraud with some
sources reporting that as many as 2
million fake accounts were created what
happened at Wells Fargo reflects
company-wide malpractice and has
industry-wide implications did these
facts get you thinking I bet a lot of
people out there are wondering this
morning how do I get my money back to
vote for which news story is covered
next
head over to watchmojo.com slash suggest
and be sure to hit that subscribe button
for more newsworthy top 10s published
every week this was illegal this was
wrong this was flatly wrong
[Music]
we know that money doesn’t grow on trees
but Wells Fargo customers have found
that bank accounts do appear out of
nowhere it’s a bank right they’re
supposed to keep track of people’s money
safety security welcome to watchmojo.com
down five crucial facts you should know
about the Wells Fargo account scandal if
they really didn’t know then that tells
me this is a bank that is simply too big
to manage number five what is Wells
Fargo Wells Fargo is considered one of
the big four banks in the United States
along with JPMorgan Chase Bank of
America and Citigroup according to rel
banks Wells Fargo was the largest bank
in the world in 2015 in terms of market
cap operating in 35 countries and
serving over 70 million customers
worldwide
in fact Wells Fargo was ranked as the
seventh largest public company on the
planet by Forbes in 2016 the bank which
today is headquartered in San Francisco
has its origins in the mid 19th century
gold rush it was founded by Henry Wells
and William Fargo who were also part
founders of American Express in 1852 in
its early years Wells Fargo was one of
the few banks to survive the panic of
1857 which saw a collapse in the banking
system in recent years a series of
controversies has dogged the brand
including fines for overdraft issues
administered in 2010 allegations of
racial discrimination in 2011 inadequate
risk disclosures in 2012 and violations
of New York credit card rules in 2015 as
well as high-profile revelations in 2014
surrounding the earnings of executive
figures number four how was the fraud
committed in September 2016 it was
revealed that employees at Wells Fargo
had been covertly creating and operating
extra bank accounts without customer
authorization an investigation found
that at least one and a half million
bogus accounts and over half a million
credit cards had been open
since 2011 without customers knowledge
the fraud was committed as a means of
not only making more money for the bank
but more importantly to boost sales
figures so that employees involved could
reach quotas and qualify for incentive
bonuses it’s reported that in some
instances fake PIN numbers and email
addresses were used in order to sign
customers up for services without their
knowledge Wells Fargo has taken
responsibility for the problem which has
been blamed by some critics on the
incentives given to employees and also
seemingly results from inadequate
monitoring checks and control procedures
either they knew or they didn’t know
in which case how can you run a giant
multinational bank the bank has been hit
with 185 million dollars in fines 100
million dollars of which goes to the
Consumer Financial Protection Bureau
civil penalty fund and it’s been ordered
to pay a further five million dollars as
compensation to the customers affected
number three how did the scandal affect
customers in many cases the extra
accounts initially went unnoticed or
unquestioned by customers small amounts
of money were typically transferred from
an existing account when the fraudulent
new one was opened a transaction that
didn’t always draw attention as some
phony accounts were then closed within
weeks customers remained unaware that an
extra product had ever been added
however many people found themselves
receiving credit or debit cards in the
mail which they hadn’t asked for and
being charged fees for accounts they had
no idea existed in some extreme
circumstances it’s reported that
customers were contacted by debt
collection agencies in relation to
outstanding fees on unrecognized
accounts analysts suggest that the dupe
was made easier thanks to Wells Fargo’s
long-established reputation for cross
selling to existing customers the
company looks after banking loans
mortgages and credit cards and
reportedly places focus on selling
additional services to customers they
already have rather than capturing
brand-new clients
number two what has wells-fargo done to
fix the problem
though the bank has neither admitted nor
denied the accusations Wells Fargo has
agreed to pay the fines and is expected
to change sales practices and incentive
structures as a result at least 5300
employees have been fired since 2011 for
quote inappropriate sales conduct in
relation to the scandal and Wells Fargo
has promised to assume greater control
over and monitoring of customer service
in a memo sent to employees on September
8th 2016 the firm said when it makes
mistakes it is quote open about them and
also confirmed that it would quote take
action Wells Fargo has also begun
repaying all customers involved
reporting that five million dollars is
earmarked for remediation with 2.6
million already paid out the average
payment per customer is $25 the bank has
also stressed that it has refunded or
will refund any account where there is
the slightest suggestion of foul play
implying that summary payments have been
made for accounts that actually were
properly authorized number one what’s
next for Wells Fargo and banking in
America as one of the world’s largest
banks at the center of a high-profile
scandal Wells Fargo is set for a
difficult period as trust in the company
has waned however customers and analysts
are already using it as a case study for
problems with the US banking system in
general in the wake of the account
scandal Wells Fargo employees have
reportedly argued that mounting pressure
to meet sales targets is reason for the
false accounts so as long as the banks
are expected to grow it’s estimated that
similar issues could continue to arise
on the one hand banks face
ever-increasing target figures on the
other there are fewer and fewer people
to sell to which is why firms often look
to make more money out of the customers
they already have this problem doesn’t
excuse Wells Fargo’s underhanded tactics
but it does help explain the scandal as
individual refunds remain relatively low
perhaps the most shocking aspect of this
story is that over 5,000 individual
employees were prepared to con customers
and participate in fraud with some
sources reporting that as many as 2
million fake accounts were created what
happened at Wells Fargo reflects
company-wide malpractice and has
industry-wide implications did these
facts get you thinking I bet a lot of
people out there are wondering this
morning how do I get my money back to
vote for which news story is covered
next
head over to watchmojo.com slash suggest
and be sure to hit that subscribe button
for more newsworthy top 10s published
every week this was illegal this was
wrong this was flatly wrong
[Music]
Please follow and like us: