Here’s what the Wells Fargo cross-selling scandal means for the bank’s growth – By Carlos Waters (CNBC) / Oct 19, 2022
- The U.S. government has determined that Wells Fargo executives created conditions that produced mass-scale fraudulent activity in the 2010s.
- The bank’s growth is capped just under $2 trillion on orders from the Federal Reserve.
- The cross-selling scandal at Wells Fargo is a notorious example of the power of American banks, according to legal scholars.
Wells Fargo is one of the oldest and most powerful banks in the United States. Its reputation today is in tatters, following a notorious scandal that is still unfolding.
Reports of fraudulent activity in Wells Fargo’s sales department first surfaced in 2013. The bank opened at least 3.5 million fraudulent accounts for unwitting customers, according to researchers at the Harvard Business School. This and other issues have led the government to fine the bank repeatedly.
Regulators for banking, consumer protection, trading, and workplace safety continue to keep a close watch on Wells Fargo. The bank says it’s working to comply with a barrage of consent orders issued by the government dating back to 2016. In addition to fines, Wells Fargo has faced a cap on its assets, issued by the Federal Reserve in 2018.
