What Is The Effect Of The Wells Fargo Scandal

In 1852, Henry Wells and William Fargo established a company that has impacted American in almost all the right ways. Over the past few months, Wells Fargo reputation has been tanking because of the millions of fake accounts the employees have been making to reach their sales goals.
On March 18, 1852, Henry Wells, William Fargo and many others joined together to form a joint stock company, that provided banking and express services in California. Wells Fargo and Company’s Express granted financial services by the quickest ways possible. From overseas by boats; to overland by horses; to railroad. Within just a few years, the company was managed electronically by telegraph, which would later develop to include radio, phone and finally the internet.
But over the past few months, the famous Wells Fargo name has been hurt by a scandal. Wells Fargo has created about 2 million fake bank and credit accounts between 2011 and 2015. With the banks nervous response in front of Congress, and disturbing stories of mistreated workers, it has only added fuel to the fire. Now there is talk that the scandal has put serious damage on the Wells Fargo name. Negative attitude towards the company has risen to 52% from 15% before the rumor started, according to a survey conducted last week of 1,500 bank customers. Positive attitude fell from 24% post-scandal from 60% beforehand. Out of the 47% of Wells Fargo customers that were surveyed, only 3% said they were directly impacted by the discredit, while 30% said they might leave the back. The other 14% has already left. Based on the management specialists, the bank is at risk of losing $99 billion in deposits over the next year, year in a half, “as a direct result of the scandal”. If that many customers decided to leave, it could eliminate $8 billion of Wells Fargo revenue. The bank currently has $1.3 trillion in deposits from all of it customers. “The short and medium term outlook for Wells Fargo is gloomy,” management wrote. “The fallout from the scandal will impact the banks bottom line for years." Bank of American, Chase and other community and regional banks could benefit from a deposit influx of $39
Relative to its widespread illegal actions, Wells Fargo has also fired 5,300 employees and managers. With one exception: the executive in charge. Instead of taking any responsibility for the wrongdoings of her employees, Carrie Tolstedt, the senior vice president who supervised the creation of all these accounts, is retiring. Taking with her millions in stock and options. Wells Fargo has $185 million in fines and other penalties from Los Angeles city, county and federal authorities. “The CFPB fined the bank $100 million-the largest fine the agency has ever handed down” the director said in a statement. The CFPB also said Wells Fargo will have to pay $50 million to the county and city of LA as a result of the scandal and the bank has to pay the “Office of the Comptroller of the Currency” $35 million. "It is important to understand the context, the 5 -year period involved and the size of our workforce," a Wells Fargo spokesperson said in a statement. "The actions we have taken with respect to team members and managers reflect our commitment to monitoring and addressing any inappropriate sales conduct. On an annual basis, more than 100,000 team members worked in our stores, and the number terminated represents about one percent of this workforce over the five-year period.” The