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So it looks like Wells Fargo is the latest big bank to come under fire for doing shitty, illegal things to millions of people. Federal regulators have revealed that the company's employees created more than two million fraudulent bank and credit card accounts in order to meet quotas. 5,300 employees were fired, Wells Fargo paid a $185 million fine, and the government released statements like this absolving the executives of any responsibility.


"Thousands of employees committed crimes for years on end. But don't worry, the CEO knew nothing."

Unlike most financial scandals, the root cause of the bad behavior here is immediately familiar to anyone who's had to work at a big box retail store. If you force salespeople to move "memberships" in order to keep their job, then they'll find a way to move those memberships, even if they have to forge applications from fictional characters like Harry Potter or Dwight D. Eisenhower. The pressure to break the rules comes from unreasonable corporate expectations, but corporate never has to ask employees directly to break the law, so they stay safe.

We sat down with one former employee, Kristen, to learn how Wells Fargo pressured thousands of normal people, many of whom were making, as Elizabeth Warren noted, $12 an hour to commit financial fraud.

4
They Turned Banks Into Stores

Spencer Platt/Getty Images

Kristen started her banking career as an employee of a Wachovia branch in Tallahassee, Florida, land of either crocodiles or alligators. We can't remember which. In 2010, her branch was taken over by Wells Fargo. Based on their ads, they're apparently the bank of choice for old-timey American settlers.

Wells Fargo
Some of us prefer our banking without mounds of horseshit, but to each their own.

Wells Fargo's folksy demeanor didn't extend past the ads. The first innovation they brought to the table was a change of terms: "At any bank, you'd call it a branch ... but Wells Fargo banks are not called branches. They call all their physical buildings stores. Because they sell." Kristen's bank had been the sort of place where the bankers knew most of their clients by name; they were a part of the community. But under Wells Fargo's rein, clients were now customers, and all that mattered was signing them up for more "solutions," like a Wells Fargo debit card, or a credit card, or online banking.

The first material change Kristen noticed came when Wells Fargo installed little pay pads at every teller station and instituted a new rule requiring customers to swipe their debit card before they even greeted a teller. "A lady wanted to come in just to cash a check -- a really good customer that we'd helped for years and years." Before Wells Fargo, "the teller wouldn't have asked for her driver's license, because she could name all six of her kids". But now, that longtime customer was nothing but a potential upsell opportunity. Sure you don't want a loan or a credit card with your Social Security, grandma?

Flashfranky/Pixabay
"Free toaster with every $20,000 borrowed. At this point, you can't afford not too. Think about your toastless grandchildren."

The next big change they instituted was roughly doubling the number of daily meetings between managers and bankers. Bankers were pressured to have new sales to report every couple of hours, which was made harder by the fact that a lot of their sales time was spent reporting on sales. "I would have a customer at my desk and [be] having a transaction with them ... or helping them with a problem that was sensitive ... it didn't matter, those numbers took precedence. So my manager would race in at 2:55 [and say], 'Kristen what are your numbers?' My customer could be in tears ... it didn't matter."

Bad sales were punished by forced attendance at 7 a.m. conference calls -- which, due to bank security measures, required the banker to show up at 5 or 6. Another way Wells Fargo punished their employees was with "sales nights," aka "several hours of cold-calling random people after the close of business."

"Those were the nights when where we would open five checking accounts for friends and family just to go home early."

Wait, what?

3
It Was Almost Like A Scam

Kevork Djansezian/Getty Images

Wells Fargo, seemingly inspired by pyramid schemes like CutCo, Amway, and the Girl Scouts of America, decided that making their bankers "sell" to friends and family was a perfect strategy. At one point, Kristen and her co-workers were given a winter break assignment to directly sell accounts to loved ones during the holidays.

Wells Fargo
"To increase oppourtunity, we ask that everyone start throwing Kwanzaa and Hanukkah parties regardless of race/religion."

"Each team member in our branch was told to get at least 10 applications during our Christmas break. That was the purpose of our holiday ... [to make us get] social security numbers and drivers licenses of our loved ones. It didn't matter if they were funded or not."

And yes, Kristen's work experience at one of the world's largest banks DOES sound an awful lot like working for a pyramid scheme. "My memory of Christmas 2010 is a manic blur, as I spent the lion's share of it soliciting, hustling, and cajoling nearly everyone I knew (or made eye contact with) to open a Wells Fargo checking account package. I spent every subsequent holiday, family get-together, and social event doing the same."

Wells Fargo
"Merry Christmas! Now sign that snowman up for a checking account, or your ass is grass."

All that mattered was selling more solutions to more customers. Kristen soon found herself pushing every customer to apply for a credit card, whether or not they wanted one. Even though "most of our clients tended to have a lower credit score on average," she'd run the applications. "They wanted us to just offer it to everybody and to have everyone apply for it ... these people were sitting with negative balances in their checking account. They weren't able to successfully manage a checking account." But Kristen found herself pushing them to apply for a credit card, even though she knew they'd be turned down, and that being turned down would hurt their credit rating. "That's not ethical or right," she said, and added, "I did this for every, every account".

It didn't matter that none of these people would get approved for their credit cards; the applications showed she was trying, and kept Kristen's bosses off her back for a little while. What she was doing wasn't technically illegal, because the customer did agree to send in the application. But that question was worked into the whole account creation process, like a Trojan horse of financial ruin. Kristen doesn't think most customers truly understood what was happening: "a lot of these people didn't realize they were saying yes, I think."

So that's shady. But things really crossed the line with the process of "pinning."

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2
Things Escalated To Straight-Up Identity Theft

StartupStockPhotos/Pixabay

"When a customer opened a checking account, the end goal was for them to leave the branch with six products and services 'fulfilled' or for six 'solutions' to have counted toward our sales goals." Some customers didn't want a debit card. Others would get the email to activate their debit card online and ignore it, like you do. The constant pressure to sell more "solutions" made this absolutely maddening for bankers: "you've got that one solution just sitting there, taunting you, and so you go in there and fulfill it for them ..." This lead to salespeople registering ATM cards, with PINs, for customers who hadn't authorized this. Kristen insists that she never engaged in this behavior, but she saw it and "can see" why some employees felt pressured to do this, even though "it's totally identity theft."

And there was more identity theft to come. Kristen explained, "Some elderly customers didn't trust computers and absolutely refused to set up online banking." When this would happen, bankers were too busy worrying what corporate would say "when they found out we only fulfilled x number of solutions with this customer". In order to avoid that unpleasant call, "many bankers would resort to impersonating their customers and input fake email addresses. Just something super basic that would never actually exist out there on the web, like noname@wellsfargo.com, to make certain the branch got credit. The customer would have no idea this happened. That's full-on identity theft."

Wells Fargo
"LOL, jk!"

Another illegal practice that began to flourish was "sandbagging." Bankers who found themselves with a surplus of applicants one week would hold off on activating those accounts until the next week, or month, to help them with the next set of quotas. First off, this meant new customers weren't able to use any money they'd deposited until the account was opened. And second, it meant pages of their private information written on paper applications sort of sat around until the sale went through.

"I would, myself, lock their confidential info in my drawer, but [it] depended on the banker ... maybe you lock it up, or you don't ..."

Wells Fargo screwed over a lot of their customers, sure. But the bank's greatest crime may be what it did to its hourly employees ...

1
Wells Fargo's Employees Are Victims Too

Wells Fargo

"Believe me, I know all of this this is terrible. I thought about work, worried about work, obsessed about work 24/7. It turned me into a monster."

Yes, even the 5,300 employees Wells Fargo fired are victims. Remember, these aren't executives who made millions gambling with other people's money. These are normal people who were forced to make a choice between "unethical behavior" and "continuing to pay rent." Identity theft obviously wasn't the right solution. But Wells Fargo fired the shit out of any employees who complained internally. Bankers who needed a paycheck were forced to broaden their moral compasses and live with the guilt.

Scott Olson/Getty Images
"By the way, any chance we could interest you in a second mortgage to tide you over till you find a new job?"

"It made me a terrible person. It was all I thought about. I hated it so much. You were stressed out all the time ... over the weekend, you were looking [for accounts]. If someone breathed a word that they needed an account, you were on them like a rabid dog."

Sociologists call this "normalization of deviance." It's a phenomenon you'll find behind a number of great disasters, from the Challenger explosion to the fall of Enron. "As the deviant behavior is repeated without catastrophic results, it becomes the social norm for the organization."

Wells Fargo executives made sure deviant behavior was the only way to get non-catastrophic results. Employees like Kristen were forced to either quit their jobs, get fired, or screw over their customers. Deviant behavior became normal behavior without so much as one incriminating email from an executive demanding an underling break the law.

And when this whole house of cards came tumbling down, as Wells Fargo's executives knew it would, a bunch of $12-per-hour bankers were the only ones found to be at fault. They got fired, while the real culprits got taxpayer-subsidized bonuses.

Gee, when have we heard that story before?

CBS Money Watch
Oh, right. Every single time this happens.

Kristen now works as a freelance writer, not a banker. She has a website, a Twitter, a a Facebook and an Instagram. She's also got an Amazon author page here.

Robert Evans just has a book, A Brief History of Vice, about his experiences re-creating strange ancient drugs.

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