Wells Fargo’s Pomposity Penalty

by Marc Rudov, Branding Advisor to CEOs
September 29, 2016

The attitudes, actions, and culture on display at every enterprise, whether nonprofit or for-profit, originate at the top: from the CEO.

Those actions, attitudes, and culture cumulatively form the organization’s brand.

Your brand, like physical fitness, is ALWAYS in a state of decay — the CEO must work diligently and perpetually to keep it strong.

Alas, too many CEOs pooh-pooh branding. Why? Pomposity. This dismissiveness will backfire.

John Stumpf, CEO of Wells Fargo, America’s third-largest bank, is learning this axiom the hard way, the expensive way, the embarrassing way.

The San Francisco-based bank is now in deep trouble for defrauding two million customers. It created fake accounts in their names, without their consents, to reach sales quotas.

To demonstrate its disingenuous concern, the bank fired 5,300 employees, as if they were rogue operators. It also apologized for the misdeeds, thinking the matter closed. Wrong.

Pomposity penalty: $185 million fine, including a $100 million penalty from the Consumer Financial Protection Bureau. Moreover, California has suspended its business relationships with Wells Fargo for one year.

CEO John Stumpf faced hostile lawmakers in the Senate Banking, Housing and Urban Affairs Committee and the House Financial Services Committee. In addition, he’ll forfeit much of his 2016 salary — including his bonus and $41 million in stock awards.

The Astrology Excuse

Was the scheme worth it? You do the math.

Think of all the Wells Fargo execs who chose, robotically, to go along with it. Obviously, they couldn’t differentiate their bank from its competitors, using creativity, so they cheated.

In my experience, most people go along to get along. Whether by being politically correct, using idiotic industry jargon, or engaging in widespread unethical behavior, they don’t want to stand out. Too scary.

The inexcusable behavior in Wells Fargo’s sordid episode strikes me as uncannily similar to that of astrologers, who blame their behaviors on the alignment of planets and stars. They never take personal responsibility for their attitudes and actions.

Astrology is pure bullshit, as is abdication of self-control.

I can’t recall how many times I’ve heard this, always from women: Marc, you’re creative and friendly because you’re a Pisces. That’s not only laughable (my creativity stems from genes, drive, and energy), but I’m no longer a Pisces!

NASA just announced that there are 13 canonical zodiacal constellations, not 12. This isn’t even news, but, for some reason, NASA decided to make it news. Imagine the horoscope headaches across the world.

So, I’m now an Aquarius, allegedly shy and quiet. Really? Not even close. I’m the opposite. Again, astrology is total bullshit — despite being a multibillion-dollar industry.

Parting Advice to CEOs

Create a culture of robotic attitudes and actions, and expect to pay a huge penalty. Either your company will become boringly irrelevant or highly unlawful.

Pomposity breeds debility.

The strongest brand always wins. Always. Why is branding not your #1 priority?

POSTSCRIPT #1: Wells Fargo Illegally Repossessed 413 Service Members’ Cars

POSTSCRIPT #2: Wells Fargo Gave to Clinton Foundation and Paid Bill for a Speech

POSTSCRIPT #3: SNL Parody of Wells Fargo Proves Bank Jeopardized Shareholder Wealth

POSTSCRIPT #4: Embattled Wells Fargo CEO Stumpf Resigns (10.13.16)

POSTSCRIPT #5: Wells Fargo Adds $32M to Fake-Accounts Settlement (04.21.17)

POSTSCRIPT #6: Wells Fargo Fraud Scandal Worse Than Thought (05.12.17)

POSTSCRIPT #7: Wells Fargo Reveals Unauthorized Online Bill-Pay Accounts (08.31.17)

POSTSCRIPT #8: The Fed Restricts Wells Fargo’s Growth & Forces Board Purge (02.02.18)

POSTSCRIPT #9: Feds to Fine Wells Fargo $1B for Fraud in Mortgages & Auto Insurance (04.19.18)

POSTSCRIPT #10: Wells Fargo Caught Altering Corporate-Customer Data (05.17.18)