Today Wells Fargo CEO John Stompf is appearing before the Senate Banking Committee to answer questions on widespread fraud at many of the bank’s branches where over 5000 employees have now been fired for opening fake accounts and credit applications in order to hit their monthly product cross-selling targets. (you can watch the hearing live starting at 10am here.)
Columnists at the Wall Street Journal have come up with a list of the 10 most pressing questions that the Senate Banking Committee (well that is, the members who are not so purchased by finance that they still have some self-respect) should ask the Wells commander-in-chief:
1) Wells Fargo and regulators say that the bank has fired about 5,300 employees over a five-year period because of the aggressive sales tactics. Who was the highest-level executive responsible for the problems and is that person still at the bank? Do you believe any of the 5,300 broke the law?
2) Wells Fargo called its cross-selling initiative “Gr-Eight” to encourage employees to sell each household eight products. Is that number good for the average customer? Can you name eight products the average customer needs from his or her bank?
3) Wells Fargo this month decided to scrap all product-based sales goals in retail branches. Why did you wait so long? Are such goals generally a bad idea, or were the sales goals simply set too high?.
And while Stumpf will most certainly offer the now well-worn c-suite plea denying any knowledge or responsibility of the illegal activities under his watch, at least a couple of the senators will correctly point out that in collecting many, many millions in performance based compensation, Stompf either knew or he ought to have known about how his employees were hitting the aggressive sales targets given to them by Strompf and his management team. Yes John, that is what they pay you the big bucks for…
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