Wells Fargo

By now surely you've heard of the Wells Fargo accounts scandal, where between 2011 and 2015 about 1.5 million checking and savings accounts, as well as 500,000 credit cards were created/issued without customer consent. Employees were told to have a goal of eight accounts per customer, oftentimes using aggressive selling tactics if necessary.

This scandal made the news in early September when we learned the Consumer Financial Protection Bureau fined the bank $185 million. It's chump change when an article I saw from 2015 said the bank's value was nearing $300 billion. Billion. With a B.

We've seen the Wells Fargo damage control PR machine at work. CEO John Stumpf saying the best thing he can do for the company is to stay and lead it. Chief Operating Officer Tim Sloan and other WF executives made the rounds on Capitol Hill trying to mitigate the damage, and Sloan himself has apologized repeatedly for the missteps. Money has been set aside for customer refunds. We heard the expected talk about restoring tarnished reputations. The program itself ends at the end of 2016.

These words and actions ring pretty hollow when you consider Carrie Tolstedt, who ran the community banking division where this happened, retired in July of this year with a golden parachute valued at nearly $125 million. Who knows how much cash they made on fees and whatnot from those unwanted accounts. The $185 million fine is probably their cost of doing business, a drop in the bucket when you consider that amount is less than 0.1% of an estimated value that nears $300 billion.

Additionally, 5,300 employees were fired and now have to find new jobs. No executives, unless you count John Stumpf, who finally resigned on October 12.

In my opinion, the PR steps Wells Fargo takes will be insufficient. It'll be a long time before they're able to repair their image. Perhaps if Stumpf had resigned last month the PR hit wouldn't have been quite as severe. Upping the amount set aside for customer refunds from $5 million to a much larger number would help, as would rehiring people who were axed. That is, assuming they'd want to come back in the first place.

Those are just a few of the things the bank could try to win back customer confidence. I look forward to reading the articles in public relations journals that talk about this scandal.