Case Study Of Wells Fargo

Wells Fargo, one of the biggest banks in the United States and used by almost 50 million people around the world was found guilty of fraud in 2016. Founded 165 years ago, with their headquarters in San Francisco, California; this bank has become one of the most important banks in the country providing different services such as banking, insurance, investments, mortgage, and financial services according to their website. Even though this company became one of the largest bank in market capitalization in the world; due to the fraud scandal last year all of that faded away. According to a study by the International Journal of Academic Research in Accounting, Finance and Management Sciences; fraud is defined as “the process of using one's occupation

According to Wolfe and Hermanson, a fraud cannot happen if one of these elements is missing. The first element; incentive is the first step to committing a fraud. This is the reason why someone will think about committing fraud, some of the examples they showed were employment stress, greed, personal debts and financial problems. In the case of Wells Fargo, employees were asked to increase the number of accounts each client had in order to increase sales and if they did not meet those numbers, they were going to be punished; therefore, the incentive of the employees to commit fraud was not getting more money, or personal reasons but instead they wanted to enhance the sales and prevent getting

Even though everybody has morals and values that can make them good persons; they can still convince themselves that they are doing the right thing even if they are committing a crime. According to Dullahi and Mansor, “a bridge between incentive/pressure and opportunity is created when an individual can rationalize the fraudulent behavior”, putting this quote into context; employees at Wells Fargo were just trying to save their jobs and make the company grow since that is what their supervisors and managers were demanding. Also, it is important to understand that whenever the fraud was happening, entire sectors or departments were working together which might have led other individuals to make the decision and think “if they are getting away with it, I can too”. Rationalization affected the company on a great level, not only because of the fraud and all of the lawsuits they are getting bombarded with, but also Wells Fargo has lost a lot of