As is outlined in this New York Times article, The Federal Reserve Board has turned the screws considerably tighter on Wells Fargo as punishment for the scandal that swept the headlines as early as 2013 in this Los Angeles Times article.
I have cited the Wells Fargo scandal a number of times as an example of boards who are either inept or liars about what they knew and when they knew it. I applaud the Fed for the position they have taken here; and I am appalled by Wells Fargo’s piddling response.
Every board member who was on board at the time this first broke needs to be replaced and publicly shamed. Remember when this first came out, they sent all of the employees who work in retail banking to ‘ethics training’ only to have them return to work under the same pressures to meet quotas, which could only be met by creating fraudulent accounts.
When this hit the media Wells Fargo fired 5,300 employees for violating their ethics policy. At the time the board and most if not all of the executive committee who should have been fired.
Take note that this same dynamic is in play with current University of Michigan Gymnastics scandal. The response by the board of directors is typical, where boards hide behind claims they were not aware, not realizing, given the fact this went on for years, it validates gross incompetence.
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