We keep it real here on CostofWork. Like it or not. If that makes you uncomfortable…good!
Recently I wrote an article about unethical treatment and workplace integrity. You can read it <<here>>. Of course unethical treatment continues to be a problem within the workplace. It grabs our attention because we all relate to it; it resonates. For instance, the never ending Penn State child abuse saga, surely, you are aware of that epic ethical failure. But let’s talk about Wells Fargo.
Well Fargo lost a discrimination case levied against them by the Department of Justice for $175 million. It was determined that Wells Fargo financed minority borrowers for higher interest rates and longer terms on their home loans than majority borrowers. That means Wells Fargo effed over blacks and Hispanics. Even if those minorities had good credit and had earned the right and privilege of better terms and financing rates. I hate discrimination, in all its forms.
I wonder if Wells Fargo actually performed an economic analysis and weighed the risk of screwing these folk versus not screwing them and how much they would probably have to pay if they ever got caught. Or if they just decided that predatory lending practices were cool and fit into their organizational integrity. Silly rabbits.
We see the headlines about corporate greed, unethical practices and instances of leadership failure and it becomes entertainment, blog fodder or cautionary tales at best. That’s okay I suppose but sometimes these things really hit home. I have a dear personal friend that works for Wells Fargo or should I say worked for Wells Fargo because as soon as the verdict came down from the DOJ, Wells Fargo announced downsizing. My friend was not a banker or loan officer, she handled administrative duties, but now she’s about to be unemployed by no fault of her own.
When a company gets caught practicing and facilitating unethical behavior, discrimination and unfair business practices, innocent people end up paying the price.
The Crime: Wells Fargo made it a practice (in a recession) to treat minorities unfairly. That cancer spread through-out the organization. They made a lot of money. They probably foreclosed on some of those high interest loans and resold them to other minorities, thus making even more money.
The Punishment: They have to pay $175M to the victims, along with fines and penalties.
The OTHER Victims: In addition to the blacks and Hispanics that got hosed, to cover their loses (cost containment) Wells Fargo has decided to lay off hundreds of employees. I’m guessing that many of them are on the low end of the totem pole.
I was going to add “no one wins” but that’s not true, someone made a fortune and they are in a nice big house chillin’.