Wells Fargo Case Study

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Saturday Nov 27th

Wells Fargo Case Study

BACKGROUND:

In fall of 2016 federal regulators accused Wells Fargo of falsely opening over 2 million customer credit card and checking accounts to meet unrealistic sales quotas (http://money.cnn.com/2016/09/08/investing/wells-fargo-created-phony-accounts-bank-fees/?iid=EL, September 4, 2017). Since then, Wells Fargo has also been accused of forcing over 500,000 customers into auto insurance policies they did not need, and the actual total number of fake customer accounts opened between January 2009 and mid-year 2015 has increased to 3.5 million, approximately.

Based on your knowledge of internal controls, you know that there are certain policies and procedures management can put in place to detect and prevent these type of errors. You are also aware of auditing procedures the auditors can use to test for and detect these same errors.

ASSIGNMENT:

Your assignment is to write a (A).persuasive argument for your opinion on the following questions: (B)Who is more at fault management or the auditor? Often, there is a shared responsibility for such failures. However, (C)your task is to determine whose failure was greatest and why. (D) You will need to acknowledge why the other side failed (the side you are not arguing for) and (E) then defend why your side’s failure was greater. (F) You will need to demonstrate that you understand and can apply the information learned in class up to this point.

This is an individual assignment.

You will be graded on the content of your report; how well-written your report is and your ability to effectively communicate your argument using the principles covered during this course.

REQUIREMENTS:

  1. You will need to specifically list which Wells Fargo failure you have chosen to address (the fake accounts, mortgage fraud or the auto insurance) AND you must state who you feel is more at fault upfront in the introduction.
  1. When discussing the failure, you have chosen, you must (briefly) discuss the consequences of that failure and all the parties that were affected by the failure (or scandal) and how they were affected. Please use the most current sources. Your case facts must be accurate. Don’t assume, look it up. A lot of information and events have occurred since 2016. The word briefly is important here, no more than a 1 to 1.5 pages on this background.
  1. You will need to address what policies or procedures (controls) must have failed in order for the scandal to have taken place. In others words, you must discuss what policies and procedures could have detected your scandal and what policies and procedures could have prevented your scandal. n your opinion on what policies or procedures (controls) that should have been in place to have prevented or better detect this failure. When discussing the controls, you must identify if the controls are preventative or detective and why you believe they are (either preventative or detective)
  2. PLEASE NOTE: the majority of this paper should be discussing actual internal controls. Actual policies and procedures that management or employee should have done or should be doing.
  3. The reports must be turned in on time. No exceptions. No late assignments accepted.
  4. The reported must be 5 to 7 pages doubled spaced using either MLA or APA style.
  5. The report must be written as a persuasive report. This means there is a clear introduction, body and conclusion. The use of titles and subtitles is expected and appropriate in this assignment. There should be a clear thesis statement, topic sentences for each paragraph and facts to support your stance. If you are unsure how to write a persuasive report please seek available resources (https://www.ncas.rutgers.edu/writingcenter, http://www.wikihow.com/Write-a-Persuasive-Essay, or whatever is available to you).
  6. You must do your own work. Any students found to be violating Rutgers academic code by plagiarizing or “buying” their assignment will receive disciplinary action in accordance with the Rutgers Academic Integrity Policy.
  7. There is no required number of sources for this assignment. HOWEVER, any sources used must be properly documented (cited and referenced). Failure to do will result in a severe reduction in your grade and possibly a ZERO if any part of the paper has deemed to be plagiarized. (Note: you can not make a persuasive argument without facts, so sources are expected). You MUST properly cite and reference all facts, quotes, etc.
  8. This paper should be your own words. No large quotations that take up a large amount of space should be used. In fact direct quotes from sources should be avoided. However, if you are using factual numbers, amounts or policies in this paper that originate from a different source, they those should be cited.

Feel free to research and find your own sources. Below I have listed just a few articles that might be helpful to start with. BUT REMEMBER you have to use the most current sources. The sources below are NOT CURRENT. (obviously, Wikipedia or equivalents of that are not acceptable sources). All sources must be PROPERLY cited WITH A PROPERLY CITED WORKS CITED PAGE.

https://www.complianceweek.com/blogs/accounting-auditing-update/senators-press-pcaob-for-answers-on-kpmg-audit-of-wells-fargo#.WahLgGOa3ZY

http://www.reuters.com/article/wells-fargo-kpmg-idUSL1N1HX1YX

http://money.cnn.com/2017/08/31/investing/wells-fargo-fake-accounts/index.html

http://money.cnn.com/2017/07/28/investing/wells-fargo-auto-insurance-car-loans/index.html

http://money.cnn.com/2017/10/03/investing/wells-fargo-hearing-ceo/index.html

http://money.cnn.com/2017/07/13/investing/elizabeth-warren-wells-fargo-janet-yellen-board/index.html

http://money.cnn.com/2017/08/11/investing/wells-fargo-small-business-credit-card-fees/index.html

http://money.cnn.com/2017/06/15/investing/wells-fargo-mortgage-modification-lawsuit/index.html