Wells Fargo CEO Tim Sloan sent a companywide message to address team member questions regarding the ongoing remediation process and warn employees to brace for more negative attention as the review process comes to an end.
“The results of our reviews will generate news headlines, but even as we face this renewed coverage, the best thing we can do is stay focused on fixing problems, making things right for customers, and building a better, stronger Wells Fargo,” stated Sloan.
Last year, it was discovered that Wells Fargo employees had opened a slew of fake accounts in the retail banking units. The fraudulent accounts resulted in a record fine, the ousting of key executives and also hurt the company’s stock price and reputation.
Sloan went on to report that, over the past 10 months, the company has contacted tens of millions of consumer and small business customers. In addition, a third party was hired to conduct an analysis of current and former customer accounts. To date, customer refunds have moved past $5 million in addition to a $142 million class-action settlement.
“A principle guiding our work to identify potential harm was to err on the side of our customers,” Sloan wrote. “This is important because the analysis is data-driven and looks at usage patterns in accounts. Since usage patterns of some authorized accounts opened with a customer’s consent can be similar to some unauthorized accounts, the analysis could not definitively determine if proper authorization occurred. That’s why we decided the analysis would identify potentially unauthorized accounts in order to err on the side of the customer.”
The next step in the remediation process will occur within a few weeks when the company announces the completion of the expanded retail account analysis for 2009 through 2016 — and Wells Fargo expects the totals for accounts and dollars remediated to grow.
In addition, Sloan detailed some of the changes at the company’s retail bank branches to ensure sales practice issues do not happen again. These include eliminating product sales goals, introducing new compensation and performance management programs, a change in leadership for the community bank and rolling out transformational changes to processes, coaching and customer interaction to take customer experience to a new level.