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Ceo John Stumpf's Wells Fargo Case

800 Words4 Pages

In 2016, Wells Fargo was accused of opening millions of accounts in the names of clients, who were completely unaware of what was going on. They were signed up for life insurance and other similar programs, as well as many other things involving them, but they did not know this was happening (“Attorney General Shapiro Announces $575 Million 50-State Settlement”). The employees were told to do this in order to meet the company’s sales goals (Kolhatkar, Sheelah). They were pressured into it because their bosses expected higher sales. They started by making fake accounts in the names of their current clients, but then went ahead and added the customers to different financial services without permission (“The Wells Fargo Fake Accounts Scandal”). …show more content…

These laws apply to financial products such as auto loans, mortgages, and bank accounts. They also mischarged over 16 million accounts (“What’s ahead for Wells Fargo and its customers”). Ceo John Stumpf was supposedly unaware of what was going on. It was unknown when he first learned about it. However, he was in a lot of contact with Carrie Tolstedt, the lady in charge of the program (“Why the Wells scandal matters so much”). The scandal was revealed by a whistleblower. Wells Fargo had to pay him $22 million in damages (“Wells Fargo Whistleblower Retaliation”). Their stock prices drastically fell once the public found out about what had been going on (“The Wells Fargo Fake Accounts Scandal”). The Consumer Financial Protection Bureau fined Wells Fargo $185,000,000 (Kolhatkar, Sheelah), but after other fines and settlements, they ended up paying several billion dollars. Several of the highest executives received criminal charges, including fraud, conspiracy, and lying to the overseers (“The Wells Fargo Fake Accounts …show more content…

Kolhatkar, Sheelah. A.P. & Co. “Elizabeth Warren and the Wells Fargo Scandal.” The New Yorker, 21 September 2016, https://www.newyorker.com/business/currency/elizabeth-warren-and-the-wells-fargo-scam. Accessed 20 April 2024. Prentice, Chris, and Jonathan Stempel. “Former Wells Fargo executive avoids prison in fake-accounts scandal.” Reuters, 15 September 2023, https://www.reuters.com/business/finance/former-wells-fargo-exec-tolstedt-avoids-prison-time-fake-accounts-scandal-wsj-2023-09-15/. Accessed 20 April 2024. “The Wells Fargo Fake Accounts Scandal: A Comprehensive Overview.” Learnsignal, 6 January 2023, https://www.learnsignal.com/blog/wells-fargo-fake-accounts-scandal-overview-2/. Accessed 20 April 2024. “Wells Fargo Whistleblower Retaliation Leads To $22 Million OSHA P.” The National Law Review, 22 November 2022, https://natlawreview.com/article/osha-orders-wells-fargo-to-pay-22-million-to-wrongfully-discharged-whistleblower. Accessed 20 April 2024. “What’s ahead for Wells Fargo and its customers.” Consumer Financial

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