Wells Fargo Employees, Including FAs, Say Aggressive Sales Culture Remains
More than two years after the bogus account scandal shook up Wells Fargo, employees say the sales culture that caused it is alive and well, including at its wealth management unit, according to news reports.
The company encouraged brokers to push more clients into recurring-fee investments, even when “it was not in the client’s best interest,” Melissa Kinnard, who worked at Wells Fargo’s Minneapolis office as a financial advisor until this January, tells the New York Times.
Kinnard tells the paper she quit because of her frustration with the bank’s culture. But at the end of January, Wells Fargo allegedly sent a letter in her name to her clients falsely claiming she was working with another employee whose credentials she endorsed, according to the Times, which reviewed the letter. What’s more, Wells Fargo didn’t retract the letter despite Kinnard’s numerous requests, the paper writes.
“That letter went out in error,” Mark Folk, a spokesman for Wells Fargo, tells the Times. “We apologize for the mistake.”
Wells Fargo has also remained aggressive about cross-selling, according to the paper, despite recent reports that it’s stepped away from the practice.
A Wells Fargo personal banker, who currently works mostly with college students and retirees with limited funds in a North Carolina branch, tells the Times his manager instructed him to boost referrals to financial advisors as well as the mortgage department, for example. And some branch workers may be eligible for bonuses if their referrals lead to sales, according to the paper.
“Some retail bank positions or more experienced bankers might be eligible to be rewarded,” Mary Mack, Wells Fargo’s head of consumer banking, tells the Times. “The pressure element is not there, but the opportunity to reward team members is.”
Mack also says bonuses aren’t determined by sales alone, the paper writes.
Wells Fargo settled with federal regulators for $185 million in 2016 over revelations that thousands of employees in its retail banking unit opened millions of debit and credit accounts without client authorization, spurred on by aggressive sales targets.
The company’s wealth management operations at first avoided the regulatory scrutiny that followed, but since at least early 2018, the U.S. Justice Department and the SEC have been investigating sales practices there too.
Wells Fargo admits its internal review suggests some clients of its Wealth and Investment Management division have been overcharged, but that it hasn’t “uncovered evidence of systemic or widespread issues in these businesses,” according to its most recent annual regulatory filing.