Wells Fargo, one of United States’leading financial institutions and the third-largest bank on the planet recently fired at least 5,300 of its employees linked to a massive scam of fleecing its customers.
The scam had been ongoing for a minimum of five years. The bank’s employees kept opening extra accounts for customers without their permission in addition to signing them up for credit cards theydid not ask for.
The employees went further and routinely created false email addresses for customers and sent notices about these unwanted accounts so the customers could not catch them on. The false credit cards would accumulate late fees for the customers and overdraft fees would pile up because money in their legitimate accounts would have been transferred to the unauthorized accounts.
This is likely to be puzzling given the reputation of Wels Fargo. However, as a businessperson, there’s something to learn from this.
Having a great reputation doesn’t make a company immune to trust issues
Wells Fargo was massively reputable, and that’s perhaps the reason why it could easily engage in such a great fraud for half a decade without raising any eyebrows. It’s out of the golden reputation that customers might have noticed issues with their accounts but simply shrugged it off anyways.
Particular sales incentives can do more harm than good
According to regulators, the bank’s widespread scam was a direct result of its emphasis on cross-selling, as well as the fact that Wells Fargo created lucrative incentives for employees who could get existing customers to open additional accounts.
This incentive backfired when it motivated these employees to come up with underhand ways to earn their perks in a win-at-all-costs spree.
Always check and countercheck your bank statement
This is apparently the most important message from this scam. If only customers could have been keen in monitoring their bank statements, they would have realised something wasn’t right off the bat.
Why did it take so long to notice the obvious malfeasance? With millions of customers affected by this massive scam, it’s only apparent thatmost customers werenot looking at their bank statements closely enough.
Some of them involved in businesses might have to put up with serious financial repercussions. Fortunately though, alternative small business loans are currently available from lenders line FAM that could come to the aid of those who have been seriously affected.