The Wells Fargo and Co., a leading US-based banking and financial services company was in the news in September 2016 for alleged unethical customer relationship management practices. While the management blamed the employees for the practices, the employees claimed that some of them had resorted to such practices to meet the targets set under a scheme called Gr-eight initiative,. The employees accused the management of putting pressure on them to achieve targets, and of harassing those who complained against the practices. The bank admitted that it had been indulging in unethical practices and agreed to pay the compensation to the affected customers. It also accepted the conditions specified by various regulatory agencies in making changes to the existing employees’ compensation packages and as well as to initiate changes in the customer relationship practices. The fact that the bank had indulged in unethical practices severely dented its reputation and put pressure on the top management to regain the name the bank had so carefully built for itself over a period of 100 years. The present case study focuses on the reasons for the employees indulging in such practices, the problems of the employees, the role of the management in ensuring timely achievement of targets, and the role of various regulatory agencies in enquiring into the various practices of Wells Fargo and Co. The cases discusses the challenges that lay ahead of the new CEO, Tim Solan, and the initiatiaves he needed to take to ensure a change in the corporate culture and regain the trust and confidence of the customers.

Finance Case Studies | Case Study in Management, Operations, Strategies, Business Environment, Case Studies

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Issues

The case is structured to achieve the following teaching objectives:

	Various factors that contributed to the unethical practices in Wells Fargo.
	The challenges employees faced in accepting orders from the managers.
	The objectives of the management in promoting the Gr-eight initiative.
	The implications of the scandal for the management and the employees.
	The challenges ahead of the management in its bid to regain its reputation

Contents

TOXIC WORK ENVIRONMENT

Keywords

Wells Fargo, Fake Bank Accounts, Gr-eight Initiative, fake credit card accounts, whistle-blowers policy, sand bagging, organizational culture, cross-selling model, Ethics in Banking

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