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Monday, September 19, 2016

Pressure Cooker Banking

Many people are familiar with the story of the exodus from Egypt. Even if people doubt some of the miraculous activity involved, they are aware that intolerable conditions for the Israelites set the stage for the mass departure from Pharaoh. The Egyptian leader was not keen on letting his slave workforce go, for obvious reasons.

But to set the stage properly, we find Moses and his brother Aaron in front of Pharaoh requesting permission for the Israelites to go into the desert to worship their God. Apparently, this really ticked off the Egyptian leader. In Exodus Chapter 5, we read this account:

“But the king of Egypt said, ‘Why on earth, Moses and Aaron, would you suggest the people be given a holiday? Back to work!’ Pharaoh went on, ‘Look, I’ve got all these people bumming around, and now you want to reward them with time off?’

Pharaoh took immediate action. He sent down orders to the slave-drivers and their underlings: ‘Don’t provide straw for the people for making bricks as you have been doing. Make them get their own straw. And make them produce the same number of bricks—no reduction in their daily quotas! They’re getting lazy.’” (Exodus 5:4-8, MSG)

And that leads me to the recent stories surrounding the departure of some 5,300 Wells Fargo employees involved in a nasty case of unlawful banking. Along with the terminations, the bank also agreed to pay $185 million in fines and refund $5 million to customers.

But the bank’s problems may just be beginning. The Department of Justice has opened an investigation, issuing subpoenas to the bank. Add to that the first lawsuit by Well Fargo customers now filed following revelations that the bank collected fees for millions of unauthorized accounts. The charges filed in court last Friday include invasion of privacy, fraud, negligence, and breach of contract. Plaintiffs are reportedly asking to be compensated for damages related to identity theft, anxiety and emotional distress, and legal fees.

Now that you know the pending punishment, let’s go back over the crime. While the recent firings created a national stir, we could see this coming from a story in the LA Times in December of 2013. I’ll do my best to summarize and share a few excerpts.

Wells Fargo was bold in sharing their “prowess in cross-selling” various financial products. These included fee generating services such as checking and savings accounts, credit cards, mortgages, and services under “wealth management.” The more services a customer has with a bank, the greater the loyalty trend.

According to the LA Times report, “The relentless pressure to sell has battered employee morale and led to ethical breaches, customer complaints, and labor lawsuits.” Again, this report is from 2013.

It became so intense that hourly conferences were mandatory in some Florida branches. The branch managers had to report on quotas for opening accounts and selling customer “extras.” Lagging performers had to stay late or work weekends.

Here’s a bit more on the graphic ways employees went beyond the boundaries.“To meet quotas, employees have opened unneeded accounts for customers, ordered credit cards without customers’ permission, and forged client signatures on paperwork. Some employees begged family members to open ghost accounts.”

A former Wells Fargo personal banker, Erick Estrada, gave his own dramatic examples of the actions taken because of sales pressure. “Employees opened duplicate accounts, sometimes without customers’ knowledge,” he said. “Workers also used a bank database to identify customers who had been pre-approved for credit cards—then ordered the plastic without asking them,” Estrada said. He admitted to opening unneeded accounts, though never without a customer’s knowledge.

What happened when customers complained about these unwanted cards? It was blamed on a computer glitch. Or maybe someone with a similar name had requested the card.

A former branch manager in the Pacific Northwest talked a homeless woman into opening six different accounts with fees amounting to $39 a month. One former Minnesota based bank employee talked about an environment that was “cutthroat.” Employees feared for their jobs and the result was “bad ethical choices.”

The New York Times pointed out interesting facts about the firings. The 5,300 who left were employees and managers—but NOT the executive in charge. She’s retiring, “taking with her millions in stock and options.” And her boss called her a “role model for responsible leadership” and “a standard-bearer of our culture.”

Every day, there must be a few million men and women who are employed in sales. There is a way to make this a winning environment, meeting customers’ needs and wants with people who present well and are not manipulative. I’ve seen it done. I’ve encouraged it in situations where I had influence.

To send people home each night in fear and hating their jobs is wrong. It’s abusive. And in the end, a lot of these poor souls lost their jobs anyway.

James, the brother of Jesus, wrote about abusive employers saying, “All the workers you’ve exploited and cheated cry out for judgment. The groans of the workers you used and abused are a roar in the ears of the Master Avenger. You’ve looted the earth and lived it up. But all you’ll have to show for it is a fatter than usual corpse.” (James 5:4-5, MSG)

When it’s all said and done, a bunch of Wells Fargo employees may want to take the next stage out of town. Maybe it’s already happening.

That’s The Way WE Work. Click on the link to the right to connect via Facebook.

Let’s Talk with Mark Elfstrand can be heard weekdays from 4-6 PM Central. To listen outside the Chicago area, tune to for live streaming or podcasts, or download the AM1160 app. 

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