ipl-logo

Ethical Issues And Concerns Of Wells Fargo

749 Words3 Pages

As children we learn the value of good behavior, morals, integrity and honesty. Since the last recession job opportunities have decreased dramatically, people have been forced to do anything to hold down their jobs. The question is: How far are we willing to go keep our job? An example of this matter is Wells Fargo, who as a part of their tasks wanted their employees to reach unrealistic goals to keep their jobs. Employees had to violate ethical policies to achieve their target goals. The bank’s sale tactics resulted in a $185 million fine, 5,300 employees fired, and several other effects on the company and customers. Identify and evaluate ethical issues and concerns of this case. Wells Fargo had an aggressive sales policy where the employees …show more content…

What is the effect on the society? As a company one of the most important impacts as that the bank will have to face as a result of this case is loss of market reputation, which may even affect its existing customer base. Lawsuits have already been filed against the company both by its employees and customers and fines have also been imposed on the company. Banking is one of the most important components of the entire financial system of a society. It is practically impossible to conduct any financial transaction without the involvement of a bank. If any kind of fraud takes place at a bank, it has a severe impact on the trust and confidence of its customers. People begin to fear as to whether their money/deposits are in safe hands or not. In some cases, customers may close their existing accounts and even decide to keep their belongings/savings with them resulting in shortage of cash/finance in the system. This is not good for the economy as well as the banking/financial …show more content…

In the given case, the sales goals were highly unrealistic and there was too much pressure on employees to meet their goals. While the bank had policies for each business process, there was no enforcement of those policies at the managerial level as they were too under a constant pressure to meet sales targets. It is essential for the top management to understand the importance of ethics and incorporate the same in the day to day functioning of the organization. In the given case, the employees who tried to report the fraud on the whistleblower hotline had to face adverse consequences (they were terminated). The overall purpose of establishing an ethical environment gets defeated if top management doesn't ensure that the ethical policies and procedures are implemented as intended. Therefore, I would advice the top management to change its attitude, set realistic performance targets and encourage employees to report any violation directly to an independent committee (may be the audit committee) with no fear of any adverse

Show More
Related
1718 Words | 7 Pages

Banking system is essential in our economics to maintain an effective circulation of money. The bank has functions for regulation of currency to aid strong economy. Distribution of the money is crucial to promote construction of the nation and prevention of bankruptcies. In our modern economic structure is supported and developed by the banking system. However, there was a period that the national bank was shut down by the government the consequence of the bank war.

Read More
1639 Words | 7 Pages

This is bad for the national economy as stated in the previous reasoning from Jackson’s veto letter due to their selfish mindsets. This is relevant because it illustrates how the bank is in danger and Jackson had to veto it to protect the economy. This shows

Read More
490 Words | 2 Pages

The government did not insure bank deposits, so if a bank were to collapse, even customers who did not invest in the stock market would lose their savings. The bank failures caused a crisis of confidence in the banking

Read More
393 Words | 2 Pages

What happened to all the banks then? Well first off people had complete trust in them, that is until the stock market crashed. Banks had invested a lot of money in the stock market also. But when it crashed they lost it all and

Read More
1999 Words | 8 Pages

This bank could cause a depression because people will get worried and pull money out of their banks which will close down those banks and cause a chain reaction and move towards bigger banks. Which means it has to end when it is small before it snowballs and gets bigger and bigger. The appeal comes from using someone else who is more prominently involved in the business world to strengthen his argument. It allows the reader to fully understand the situation that is going on so that they do not have to panic and pull all of their money out of the bank. This reverts back to the purpose of giving the reader more insight to a situation that could affect them and the author gives their view on how even small banks can pose a threat to causing another depression.

Read More
1501 Words | 7 Pages

Depositors lost all the money stored in that bank. Because of this, consumers spent small amounts of money, which threatened many businesses. Meanwhile, farmers and factories were responsible for the overproduction of goods. Customers’ money was lost

Read More
1978 Words | 8 Pages

Wells Fargo To Nix Sales Goals After Fake Account Scandal. Retrieved 09 19, 2016, from forbes.com: http://www.forbes.com/sites/laurengensler/2016/09/13/wells-fargo-to-end-sales-targets-after-fake-account-scandal/#c41eba622dcd ft.com. (2016, 9 19).

Read More
946 Words | 4 Pages

According to the textbook, Auditing For Managers, this is a four stage process. First, controls will need to be implemented at the corporate level, which is referred to as the head office in Sunshine Fashions, and they need to apply to all levels of the organization. Second, each level and location will need to identify potential risks relevant to that area. Management in those locations need to have a good understanding of the risks identified. Third, controls may need to be tailored to the specific needs of that location as long as they are still within the boundaries of corporate policies.

Read More
709 Words | 3 Pages

Wells Fargo Banking Scandal: A Case Study in Ethical Management The Wells Fargo banking scandal, as detailed in the Santa Clara University Markkula Center for Applied Ethics case study, highlights the significance of ethics in managing businesses. This essay explores the values embodied by former CEO John Stumpf, their impact on Wells Fargo's culture, and the importance of leaders modeling ethical behavior to promote a moral organizational climate. The essay also addresses the failure of Wells Fargo's ethics hotline and the steps leaders can take to design effective systems that encourage ethical conduct. Ethics play a pivotal role in shaping the conduct of organizations and their employees.

Read More
642 Words | 3 Pages

However, this will also impact large banks such as Wells Fargo as there may be capitalism and use of taxpayer

Read More
1277 Words | 6 Pages

After the 2008 Financial Crisis, and with the addition of the Wells Fargo Debacle, ethics within Financial Institutions have become a hot topic. Consumers are hesitant to place any trust in the financial sector. This paper defines ethics and what it takes for a financial institution to make ethical decisions. It not only looks at the organization but also looks at management and individual employees. The paper also addresses the ethical issues that can arise within financial institutions.

Read More
819 Words | 4 Pages

PREVENTION METHOD IN AUSTRALIA AND NEW ZEALAND Given the high cost of fraud to the Australian public sector organizations, prevention needs to be a key priority. From the survey results indicate that organisations remain focused on traditional prevention methods: 1.

Read More
468 Words | 2 Pages

Under this approach, an action is considered morally bad because of some characteristic of the action itself, not just because the product of the action is bad. Wells Fargo unethical practices demonstrates unethical behavior, under deontological ethical theories as its employees duty to operate in an honest and fair fashion , in providing services to the public. Wells Fargo codes of conduct does not permit sales practices of these sort, therefore the employees who participated in these practices made unethical decisions. Unfortunately there was a wrong-doing on a massive scale. The acts of unethical behavior were conducted by both the employees and management.

Read More
245 Words | 1 Pages

I thank in the financial and banking case is much like my current employer,Wal-Mart, that has a well written different forms codes of conduct. These codes of conduct range from code of ethics, state of values and statement of values that are written within employment contract and on their web based intranet. However like most companies that have poor to nonexist codes of conduct these codes of conduct are never used or flat out ignored. These non-ethical corporate culture tend to promote sales before ethics or values system, which rotate towards a management x or transactional leadership were policies and laws are just pieces of paper. Such culture tend to undervalue associates respect and self worth as an individual within that organization.

Read More
926 Words | 4 Pages

The Ethics of Business There have continuously been complications with the application of moral standards in the business environment. What is considered the correct ethical act on a daily basis outside of employment could be entirely different in a business setting scenario. Numerous philosophers have endeavored to reason out rationalizations as to why ethics is considered different in business and have formulated different techniques of methodizing, representing, and commending concepts of what the right moral action should be in certain business situations. Recently Wells Fargo has been involved in a scandal where the business opened millions of unauthorized accounts to ensure high sales. Wells Fargo subsequently fired around 5300 mid-level

Read More

More about Ethical Issues And Concerns Of Wells Fargo

Open Document