Wells Fargo said Tuesday it will eliminate the sales goals a federal investigation concluded led thousands of the bank’s employees to create fake accounts that customers did not want so that workers could earn bonuses.
The announcement comes less than a week after the San Francisco-based bank was fined $185 million for the scheme, which regulators said was allowed to fester over five years. Wells Fargo said it dismissed 5,300 employees for the practice.
Chasing “compensation incentives,” bank employees went as far as creating phony email addresses to enroll existing customers in online-banking services and issued them debit cards they did not request, government regulators alleged. Some even created fake personal identification numbers. Customers were then often hit with assorted fees totaling millions of dollars for accounts they never authorized, the regulators charged.
Wells Fargo said the sales goals will end Jan. 1.
“Our objective has always been and continues to be to meet our customers’ financial needs and drive customer satisfaction,” the company’s chief executive, John Stumpf, said in a statement. “We are eliminating product sales goals because we want to make certain our customers have full confidence that our retail bankers are always focused on the best interests of customers.”
The sales goals were part of Wells Fargo’s aggressive push into “cross selling,” persuading customers to sign up for multiple products. A customer with a checking account, for example, would be encouraged to consider a credit card or savings account. The industry has been under pressure amid historically low interest rates and tighter banking-industry regulations after the 2008 financial crisis, and “cross selling” can be a profit driver.
Wells Fargo has also temporarily scaled back its cross-selling push. On Friday, the day after the settlement was announced, the bank expected to be inundated with calls from concerned customers. The bank told call center employees to forgo their usual cross-selling and to focus on answering as many calls as possible. The move is temporary and may end by the end of this week, a company representative said.