The Wells Fargo Commercial Banking Scandal

Abstract

On October 25, 2016, Timothy J. Sloan, the new CEO of Wells Fargo bank, apologized to 1,200 of his employees in Charlotte, North Carolina. Sloan had been named to the company's top position two weeks earlier, when then-CEO John Stumpf resigned amid fallout from the banking scandal for which Sloan apologized. In September, Wells Fargo had agreed to a $185 million settlement with the Consumer Financial Protection Bureau (CFPB) and two other regulatory bodies, admitting it had opened unauthorized accounts for millions of its consumers. At the heart of the scandal were the company's community banking sales practices, which focused relentlessly on cross-selling multiple products to existing customers. Excerpt UVA-C-2394 Rev. Oct. 27, 2017 The Wells Fargo Banking Scandal We've been called, true or not, “the king of cross-sell.” —Wells Fargo CEO John Stumpf's 2010 letter to shareholders . . .