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TEACHING NOTE
Wells Fargo’s Unauthorized Customer Accounts
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This case illustrates the following themes and concepts discussed in the chapters listed:
Theme/Concept Chapter
Stakeholder analysis 1
Organizational ethics 6
Corporate governance 13
Consumer protection/consumer rights 14
Employee compensation 15
Case Synopsis
This case describes the actions of Wells Fargo, a leading bank and financial services
company, which opened more than two million unauthorized checking, credit card, and
other accounts without the consent of its customers between 2011 and 2015. Wells Fargo
settled with the U.S. government and state and local regulatory agencies, paying more than
$100 million in fines, without admitting or denying the alleged misconduct. In late 2016,
when the case opens, the bank also faced lawsuits from customers, former employees, and
TEACHING TIP: WHERE TO USE THE CASE IN THE COURSE
TEACHING TIP: VIDEOS
Several videos may be used in conjunction with this case.
A short introduction to the case prepared by CNN Money, “Here’s How Wells Fargo Workers
Created Fake Accounts” (4:27), which includes an interview with an employee explaining the
pressure to open unauthorized accounts, is available here:
Discussion Questions and Answers
1. Describe the “unauthorized customer accounts” referenced in the title of the case.
What did the bank and its employees do? Which stakeholders were helped, and
which were harmed by these actions?
Which stakeholders were helped, and which were harmed by these actions?
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2. Do you believe Wells Fargo demonstrated an ethical corporate culture? Why or
why not? In your response, please consider both the formal ethics policies of the
bank and ethical leadership as modeled by its senior executives and board of
directors.
How did Wells Fargo’s culture, as manifested in its formal ethics policies and the
leadership modeled by its senior managers and board members, influence its employees
behavior?
On the surface at least, Wells Fargo had taken many steps to establish a strong
The bank had a Code of Ethics and Business Conduct that described the importance
of ethical behavior and emphasized employees’ responsibility to protect the reputation and
The bank had publicly declared that “we strive for the highest ethical standards with
our team members, our customers, our communities and our shareholders.” Top executives
The corporate governance practices described in the case mostly correspond with
the best practices described in Chapter 13. Of the bank’s 15-member board, all were
independent (outside) directors except for the CEO. All standing committees of the board,
TEACHING TIP: WHY WERE GOOD PRACTICES NOT ENOUGH?
3. Describe “cross–selling.” What were the benefits of cross-selling to the bank and
its shareholders? In what ways did cross-selling contribute to the problems Wells
Fargo later faced?
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4. If you were an employee of Wells Fargo and felt pressured to cross-sell to
customers, even when you felt this was inappropriate, what would you have done?
5. Did Wells Fargo respond appropriately to employees who voiced their concerns
about unauthorized accounts? What should it have done differently?
6. Looking at the case as a whole, what steps would you recommend Wells Fargo, its
senior managers, and its board of directors do now to prevent such events from
occurring again in the future?
Students may make a range of suggestions for senior managers and the board.
These may include:
TEACHING TIP: WHAT DID WELLS FARGO DO?