Category Archives: Business Ethics

Wells Fargo Confirms that Big Banks are a “Basket of Deplorables”



In what The New York Times called, “The brazen scam no one noticed,” Wells Fargo Bank has admitted to scamming thousands of customers by surreptitiously opening an estimated two million bogus credit card, checking and savings accounts. Acknowledging this fraudulent activity, Wells Fargo has agreed to pay a fine of $185 million dollars.

Of course, from the CEO down, Wells Fargo management has denied any knowledge of this activity and have placed the blame on the lowest levels of employees; announcing that over 5,000 employees have been terminated for their involvement. (The New York Post is reporting that hundreds of current and former Wells Fargo employees have taken to social media asserting that the fraud was an “open secret known by all at the bank.” Many cited being penalized by management for not going along with the scam.)

The final story has yet to be told, but it strains the credibility of common sense to believe that a scam of this magnitude could go on for so long (5 years) and be so pervasive within the Wells culture without management at all levels being aware of it. (The New York Times reported that the senior executive who oversaw this group of “rogue employees” announced her retirement and walked away with a $124.6 million dollar severance package.) It might even say more about Wells Fargo management if they didn’t know about this fraudulent activity carried on for so long by so many people.  

If one is to believe that the Wells Fargo CEO and all his minions had no idea the scam was being perpetrated on thousands of customers it is proof-positive evidence of stupidity, incompetence and non-existent corporate governance. How can over 5,000 employees independently and systematically dupe thousands of customers for years, without some evidence of this activity coming to the attention of management? It means that management is either dumber than gold fish or they condoned it by turning a blind-eye to it in the name of personal bonuses and corporate profit.

Wells Fargo is not Alone

If the actions of Wells Fargo were an outlier of typical big bank stupidity, incompetence, dishonesty and greed it could be passed off, but unfortunately it is further validation of the fundamental flawed DNA of bankers. But it would not be fair to lump all bankers into this category; there are good bankers. Unfortunately, the actions of 99 percent of the bankers give a bad name to the others.

The Wells Fargo is just another example of a history of the banker’s attitude of deceit, greed and dishonesty when it comes to dealing with customers, but it goes further than that. A quick review of every national financial crisis in the past 200 years will show that the greedy and foolish acts of banks were the spark that set the crisis in motion.

Wild stock speculation by banks brought on The Great Depression of 1929. The very first act of Franklin Roosevelt when he became president was to close all the banks in the country. This led to Roosevelt’s famous quote, “The only thing we have to fear are bankers who run-a-muck.”  Soon after that the Glass-Steagall act limiting and controlling the size and activities of banks was passed. It is interesting to note that from the time Glass-Steagall was passed in in 1933, until it was repealed in 1999, not one single large bank failed and the country did not suffer a serious financial crisis.

The 1999 repeal of Glass-Steagall allowed the banks to consolidate into huge national institutions and put their capital at risk in insurance, investments and investment banking. Armed with this new-found freedom, it took less than a decade for the decisions of incompetent, greedy, deceitful bankers to become the catalyst for the greatest financial crisis since The Great Depression.

Learning the lesson again of just how greedy and stupid bankers can be if left to their own devices, in 2010 Congress passed the Dodd-Frank law. Although not perfect, the primary objective of Dodd-Frank is to rein in the size and laissez faire actions of banks. The intent is to prevent banks (and any other financial institution) from becoming “to big to fail;” so that the failure of any one bank would not take down the entire economy with it.

Even Bankers are Upset with Wells Fargo

Exposure of the deceptive practices at Wells Fargo comes at a particularly bad time for banks, because the banking industry is right in the middle of an expensive, lobbyist-led effort to repeal Dodd-Frank so they can once again revel in the unrestrained freedom they enjoyed after the repeal of Glass-Steagall. The big banks are upset with Wells Fargo, not for what they were doing, but because this incident draws attention to just how greedy, deceitful and stupid bankers are as a group. They are worried that the actions of Wells Fargo will make it even more difficult to repeal Dodd-Frank.

At the same time, even the smaller banks – ones that tend to be more connected with their communities and customers – are furious with Wells Fargo. They fear that the actions of Wells Fargo could result in even more regulations that significantly increase the cost of doing business.

We should not be surprised (and shame on us if we are) by the deceiving actions of Wells Fargo, but it should remind us that big banks are too incompetent, greedy, deceitful and stupid to be left on their own; especially when the size of their mistakes can damage the entire economy.

Just as Ulysses, the Greek king of Ithaca, had himself bound to the mast of his ship so he would not follow the seductive song of the sirens, bankers should be bound to only be bankers, lest they succumb to their own stupidity and the siren songs of greed, deceit and avarice; taking us down with them.

The Secret to the Joy of Firing Someone

How to make firing someone cathartic for you and the one fired

Donald Trump may take perverse joy in scowling “You’re fired!!” on his mindless reality show, The Apprentice, but unremorsefully humiliating an employee is not a perk for being boss, it’s an imbecilic caricature of what a businessman should be.

The truth is that the process of involuntarily terminating someone’s employment can be Trumpdistressing for both the terminator and terminated. Unless the firing is “for cause,” who among us can feel good about putting a person – usually with a dependent family – on the unemployment lines? What sense of fear and uncertainty washes over a person who comes to work in the morning with a job and goes home at night without one?

I was fortunate in my business career not to have to fire a large number of people before I learned how to do it the right way. The experience used to be just as traumatic for me as it was for the person being terminated. Even when it was clear that a person was not performing up to acceptable levels, I would fuss and fret, delay and rationalize the decision until it became an unnecessarily painful event for the employee and me.

The HR Rulebook Teaches the Legal Way to Fire, but not the Right Way

The beloved HR people and their loathsome lawyers feed you all the “dos and don’ts” when it comes to firing an employee, but these are just techniques and processes designed to ward off office upheaval and litigation. They will counsel you to do it yourself, do it in person, have a checklist, don’t sugarcoat your words, follow company procedure, document the process and, believe it or not, have a lawyer present.

These are all good recommendations when the intent is to protect the company and head off a lawsuit, but they also seem predicated on the assumption that the action will come as a complete surprise to the employee. Notably lacking in this scenario is any indication of compassion or concern for the employee. It’s no wonder, then, that the typical firing is so often a downer for all concerned to say nothing of the terrible message it sends to other employees.

My contention is that firing an employee does not have to be that way. Sure, it’s important to protect you and the company against unwarranted litigation over the firing, but it is also possible to fire someone with compassion and understanding that, at the very least, will take the edge off the process. Believe it or not, it may even be possible to make termination a positive experience for all concerned.

Two steps to successful firing

It was only after I learned two important principles that the process of terminating an individual’s employment became a palatable, if not positive experience.

First of all, if the person being terminated was surprised by my action, it was my fault. I deserved to feel bad. It meant that I had failed as a manager to consistently and effectively communicate my dissatisfaction – using specific examples – with the individual’s performance. I learned early on that people could not read my mind or even my body language concerning their performance on the job. It may have been clear in my mind that the individual was not doing the job, but unless I made my impressions very clear to the employee, I was failing in my responsibility and should not have been surprised that they were surprised when they were fired.

Once I understood and accepted this responsibility to the employee and the time came to sit down and pull the trigger on the firing, there was no surprise on the part of either party. I may not have looked forward to firing the employee, but I no longer felt guilty about the process.

The second principle to successful firing may seem counterintuitive, but it is perhaps the most important element to creating a positive environment in the entire process. I discovered that many individuals who deserve to be fired are actually relieved to be fired. I know that does not make a lot of sense, but it is true. I would fret and anguish over having to fire an employee, yet when the meeting came about, I was surprised at the sense of relief exhibited by many employees. It was as if they had been waiting – even wanting – for the event to happen.

What I learned was that most employees know better than anyone how they are performing in the job. When a worker is in over their head or is simply not motivated to do the job, they know it and it puts a tremendous amount of pressure on them. There is the FakingItuncertainty over how long they can continue to “fake it” and the anxiety wondering when they will be “caught” and held accountable. They are not happy in the job and this causes their effort to spiral downward even further. Of course, they are not going to raise their hand and advertise their failing, but they definitely are looking for a lifeline. Also interesting is the fact that the longer it takes for the boss to “liberate” them from the job, the less respect they have for the boss. And this creates unnecessary tension when the firing finally comes.

I came to understand that if the entire process leading up to and the actual firing itself is handled in an open, honest fashion and with compassion, then the actual firing of an employee can be a positive experience. Really, it can be. When the boss has done all that should be done to support, assist and communicate with the employee, they can be comfortable with their decision. From the worker’s perspective the burden and uncertainty of being in a job they know they are not or can’t do effectively is taken off their shoulders.

Showing Compassion Lessens the Conflict

In essence, once I learned to approach the firing process from the perspective of the employee it put me in parallel with their concerns, fears and feelings and went a long way toward making the termination process more cathartic than conflicting.

It is not always the case, but more often than not the situation of poor performance calling for termination is because a good person has been put in a bad job. Most good people want to do a good job, but they often find themselves in a job that does not fit their interests, talent or experience. This creates increasing anxiety and fear, driving performance even lower. However, when the boss comes to the under-performing employee more in the role of a liberator than an exterminator, there is more relief than regret.

My experience taught me that if I approached the firing process more as a supportive counselor than a bearer of bad news, the experience was always more positive than negative. I learned that the best approach was to be totally honest about their current performance being unacceptable – and this should not have been a surprise to them – but that I wanted to help and support them in the effort to find a new job – either within the company or outside.

Two things this approach did not include were washing my hands of the process by turning them over to HR for the usual prepackaged legalize “termination package” or suggesting that I would be less than honest if contacted by another perspective employer. But what I did promise was that I would help and support them in finding a new job that better fit their skills and interests.

It may seem fanciful to some, but by following this approach to firing someone, more often than not the person would thank me. Not for being out of a job, but for being out of a job that was more stressful for them than their lack of performance was for me. They respected and appreciated that I stood up and did what they should have done themselves. Such a reaction almost made me look forward to the joy of the next firing — even though I was not Donald Trump.

The Best Way to the Top is to Look to the Bottom (But not the boss’)

When working your way to the top of an organization it is better to be pushed up than pulled up

At the start of any career, getting to the top looks like a long and arduous journey. The climb to the pinnacle of any corporate pyramid is considered so tricky and fraught with so many seemingly impenetrable obstacles that thousands of books and articles have been written purporting to the offer the secret route to the apex of corporate power.

For the most part, these lessons in corporate ladder-climbing suggest that the climber look to those above them for a helping hand. The idea is to try to kissing-assimpress, curry favor, ingratiate and kowtow to those above you; all in the misguided hope that they will pull you up the ladder to power. This strategy for getting to the top is succinctly categorized as the practice of “ass-kissing.”

And ass-kissing must work, since so many people have done it for so long. In fact, from a very young age we are conditioned and trained to use this technique to get ahead. Children learn early on that acting sweet and nice in front of adults, no matter how they may act with peers and siblings, will invariably get them treats. Most are so indoctrinated in the dissemination of false flattery and insinuating themselves into the good graces of those in authority, that by the time they graduate from college they are ready to turn pro. This preparation is deemed essential, because it is a generally accepted dictum in the business world that admission into the elite corporate inner sanctum comes only to those who have proven their proficiency at kissing the asses of those above.

At the same time, we are encouraged to facilitate this ass-kissing task by using those below us in the pecking order as stepping-stones so as to be properly positioned to pucker our lips. (All the while expecting those below us to perform the same function. Much like a chain ass-kiss.)

Down the Up Staircase

The truth is that this concept is ass-backward. In reality, the surest, fastest, safest and most secure way to the top is to pay more attention to the needs, plans, desires and motivations of those below you. By adopting this contrarian approach to career-climbing, the respect you show for those who work for you (after all, they know you don’t have to do that) will motivate them to join together, work hard and push you up. In practical terms, it is much better to have a broad basis of support pushing you up than it is to depend on the idiosyncrasies of a few above you to pull you up.

But don’t get me wrong, I am a firm believer in offering deference and respect to those with greater experience and higher in the pecking order – if they deserve it! And even if they don’t, it is appropriate to show respect for the position, if not for the individual. Our bosses deserve loyalty, respect, and support – until they do something to prove otherwise. But those qualities are best delivered honestly – face to face – not by false flattery and bending over to find an ass to kiss.

I know that it seems like pure Pollyanna to suggest that this anti-ass-kissing strategy will work in the real world, but that is because so few have the courage to employ it; not that it won’t work. There are so many real world examples of the weakness of power when it is focused at the top and the broad base of real power that comes from below, it amazes me that more in the corporate world don’t recognize this reality and use it for their benefit.

Remember back to the days of the Soviet Union and the Iron Curtain. Poland had been sucked into the orbit of the Soviet Union. The power in Poland was consolidated at the top and supported by the military strength of the USSR. If ever there was an ass-kissing society, this was one. The only way one could survive, let alone move up, was with some very serious ass-kissing. Then there was this guy Lech Walesa. He was a lowly electrician in the Lenin Shipyard (now the Putin Shipyard) in Poland. He was about as far down as possible on the political power-grid, but he was anything but an ass-kisser of those above him. He certainly was not helped from above, but he ended up leading the overthrow of the Russian ass-kissing government and ultimately became president of a free Poland. So what happened? Walesa looked down, not up. Appealing to the needs and desires of the masses of powerless people he was able to congeal the efforts of the many to create a power force that ejected those at the top and pushed Walesa up.

Think of it another way: The most powerful natural force on earth is the volcano. How is this power demonstrated? Rocks and debris are hurled thousands of feet in the air and miles away from the volcano, but they are not sucked out of the volcano, they are ejected by a massive force that pushes up from the bottom.

Sure, these examples are a bit grandiose and unlike anything any of us will encounter in our own day-to-day corporate battles, but the fundamental concept demonstrating that real power always works its way from the bottom up and not the top down is relevant – even in the more mundane task of corporate ladder-climbing. It is the recognition of where real power comes from that is important in these examples, because it helps us to understand that the best way to move up is to be pushed up not pulled up. When we recognize that fundamental fact, it not only allows us to see the ultimate futility of ass-kissing for what it is, but more importantly it offers a better strategy for moving up.

My experience in business taught me that the pathway to real and lasting success came from helping others be successful – not the dead-end of ass-kissing. Although I do plead guilty to sometimes playing the fun game of faux ass-kissing, simply to mock those who lived by and fed off it (oh, the stories I could tell about that.) Anyway, the reality is that if we will look down the ladder, instead of up it, and help the people below to be successful, then they will push us up.

I learned early on the rule of “power of numbers” in trying to accomplish my goals. There was a limited amount I could do alone – and even less if I spent time ass-kissing. However, if I could support and motivate those below me, then a lot more could be accomplished and my fortunes would rise with the tide. When you are sincere and honest in your efforts to protect and help those below you to achieve their own personal success, they become a base of support that gives you immense power.

And the Moral of the Story …

Don’t be beguiled by the value of kissing up to your superiors, regardless of how far you ascend the corporate ladder. Deferential? Yes. Toadying? No. Ass-kissing? Never. Break the culture of corporate ass-kissers by stepping out; concentrate on being the best at what you do, accept responsibility and most of all, build a solid foundation of support by looking down the ladder, not up.