In this brief post, the focus will be on updating the stories we have covered in the past here in Financial Regulation Matters regarding Wells Fargo and their performance over the past decade or so. The last time we covered the scandal that has blighted Wells Fargo’s progression was in May of last year, and since then there have been a number of developments. However, very recently, the bank has received a number of fines which demonstrate the failures that have left the bank struggling to regain the trust it needs to move forward. We last looked at Wells Fargo this time last year, and in that post we looked at the actions of a bank who fraudulently created between 2 and 3.5 million fake bank accounts for the purposes of selling services to customers who often were not aware of the actions taken on their behalf. We covered the details of the fraud in those previous posts, so today it is worth looking at the legal reaction to that fraud. We begin at the end of last month when t...

Yesterday Financial Regulation Matters was a year old and, coincidentally, a number of stories covered throughout the first year of the blog have had some significant developments over the past few days; so, in today’s post, we will have a whistle-stop tour of these developments and ask how the recent developments may impact upon a number of parties concerned with these impactful business stories. Samsung Heir Released from Prison On the 25 th August 2017, we assessed the impact of the changing political, legal, and business landscape within South Korea with the massive news that Lee Jae-yong, the heir to the massive Samsung empire, was to be imprisoned for five years on counts of bribery, embezzlement, and perjury amongst a whole host of criminal infractions as part of his attempt to consolidate his, and his company’s position as one of the leading ‘ chaebols ’. The news today, that Lee’s sentence was reduced to a suspended sentence after just a year in prison , should b...

Today’s short post acts as an update to the March post in Financial Regulation Matters that discussed the bank’s fraudulent creation of up to 2 million fake bank accounts, for which it was fined $185 million. However, news over the past few days has revealed that, in fact, up to 3.5 million unauthorised customer accounts may have been opened instead. This post will therefore assess these claims and will then go on to look at what this ever-developing scandal is doing to Wells Fargo’s reputation – ultimately, the claim by major investor Warren Buffett, that the scandal is not materially damaging , may have already started to be proved wrong by developing events. As this issue has already been discussed in Financial Regulation Matters , there is little need to go over the scandal in any great detail again (a quick review of the scandal can be found here also). However, for us, the news that the 2 million figure for unauthorised bank accounts is likely to be increased upon inves...

Today’s short post looks at the case of Wells Fargo and how it has responded to the scandal that saw it fined $185 million for fraudulently opening up to 2 million accounts , on the basis of extensive pressure from the very top of the company to hit quotas – with its now former CEO John G. Stumpf famously developing the mantra of ‘ eight is great ’ meaning that each customer should be hold at least eight Wells Fargo products. However, recent news suggests that investors in the massive bank are starting to mobilise in order to affect some sort of positive and responsible change, a development witnessed in the U.K. recently as well, as alluded to last month in Financial Regulation Matters , but this post will suggest that the chances of affecting that change are slim and that, ultimately, how Wells Fargo responds in reality will be a clear indicator into the power of the institutional investor. The scandal which hit Wells Fargo recently, despite Warren Buffett’s (a major invest...