Let’s recap the problems at Wells: The fake accounts debacle, the fake auto loan insurance mandates, the mortgage changes without authorization (fake again), and the sacking of four foreign-exchange bankers along with the transfer of an executive from that area of operations. Now add a new development. The Comptroller of the Currency has issued a confidential report on Wells Fargo, which, naturally, was leaked to the New York Times. The report discusses the failure of the bank to respond to consumer complaints about the issues listed in the recap. Also, the report concludes that Wells failed to supervise what its contractors (i.e., insurance companies benefiting from the Wells mandate) were doing. Wow — the hits keep on coming at this bank.
The report does praise the bank’s hiring of consultants and launching of investigations. The question the gaggles of specialists are not answering is obvious except to anyone at Wells or the Office of the Comptroller: What is it about the culture of Wells that causes this type of conduct? The conduct is not isolated to the consumer division now. Until Wells gets at that question, the clean-up will continue. Clean-up does not solve culture problems. Clean-up is checklist. Clean -up is full-page ads pledging to do better. Clean-up is spending money. Clean-up is an expensive process for the privilege of moving on, but it is not a solution to the cultural problems that fueled all of the list. The Comptroller is praising clean-up. Think about this: In the midst if trying to clean up one of the most embarrassing and blatant abuses of customer trust, Wells had ongoing behaviors among employees in various divisions to whom it did not register that something was awry with their conduct, i.e., fake stuff. Causation here is deep in a culture that needs some work.