In 2013, the Los Angeles Times wrote about Wells Fargo employees signing up customers for products without their content, from credit cards to extra accounts.
John Stumpf, the bank’s CEO, kept a low profile. Even though his managers fired 5,300 employees over a five-year period tied to the wrongdoing, Stumpf did not reassure the public that the problem had been addressed or announce that any senior executives had lost their jobs.
When the situation escalated in September 2016, Stumpf, 63, remained below the radar. On the day that he reached a settlement with federal regulators, he wrote an internal note to employees promising that the bank would rectify its mistakes. But he didn’t apologize to them.
Around that time, Wells Fargo ran a full-page advertisement in The Wall Street Journal. But Stumpf did not sign the ad, making it seem impersonal. Nor did he make any public comments.
Stumpf made matters worse when he appeared before Congress. Rather than answer lawmakers’ questions forthrightly, Stumpf evaded their inquiries. Sen. Elizabeth Warren criticized his “gutless.”
In his only TV interview, with CNBC’s Jim Cramer, Stumpf failed to take full responsibility for the crisis. Instead, he hedged.
“To the extent that we don’t get it right 100% of the time … if we don’t make that plan, I’m responsible, I’m accountable,” he said. “Anybody else in the company, we all feel accountable and responsible when we fall short of that plan.”
He refused to express regret about the bank’s aggressive sales culture where managers pressured employees to cross-sell various products to customers. Rather, he continued to speak highly of the bank’s goal of selling as many as eight products to each customer household.
His tone-deafness cost him his job. In October, he announced his retirement.
— Adapted from “Wells Fargo’s Botched Crisis Management,” Emily Glazer, www.wsj.com.