Wells Fargo and Company was founded in 1852 as an American banking and financial services company that serves both domestic and internationally. According to Wells Fargo’s Quarterly Fact Sheet, they provide banking, insurance, investments, mortgage, and consumer and commercial financial services through more than 8600 locations, 13000 ATMs, online and mobile devices. This company stands as the third largest bank in the United States. Given their long lasting history in the industry, it was disappointing to learn that Wells Fargo has found itself involved in a major fraud scandal where employees created over two million false bank accounts for customers. Such action requires evaluation of the bank’s decision to pay $185 million in fines in …show more content…
Upon the uncovering of the phony accounts it would have been proper to issue an apology statement, full settlement to those affected and encouragement of a resignation by CEO John Stumpf. Such a resolution can be supported by both Kantian and utilitarian theories. Under Kantian theory, the decision to create unauthorized customer accounts was a use of its customers purely as a way of means. This goes against the Kantian respect for persons theory that “persons should be treated as ends and never purely as means” (Beauchamp, 28). While employees risk reprimanding action by managers for failing to meet quotas and losing incentive wages, the integrity of the bank is maintained. On the other hand, the failure to address faulty action was detrimental in the long run. As stated by shareholder Warren Buffet, “The problem was they didn’t do something about it until they learned about it” (CNBC). Wells Fargo failed to make a timely reaction to the scandal and release the 5,300 employees involved. Instead, they turned a blind eye to the issue as they saw increase profits and stellar quotas met. Choosing to remain silent created more harm for those involved in the scandal including affected customers. As reported by the LA Times, although Wells Fargo has pledged to reimburse customers affected by the authorized