Greed and Delusion in Wells Fargo. Or “In Praise of the Ethical Man”

Greed and Delusion in Wells Fargo. Or “In Praise of the Ethical Man” October 1, 2016

In this current political season, in which both major candidates have given rise to unprecedented levels of distrust – much deserved though some certainly not – it is all the more important to call to mind the fundamental goodness and growing morality of the American populous. Both of those – fundamental goodness and growing morality – are subject to debate, I know. But I am an optimist, and a fan of evidence. I know that my own situation is far from perfect (as an adjunct professor at a liberal arts college dipping my toes further into an uncertain academic job market), and that the situation of far too many fellow Americans is much worse.

In the face of a world seemingly gone mad, it can seem all too easy to justify one’s own moral missteps. To rationalize one’s misdeeds as “the way it is.” This, I keep telling my Intro to Ethics students, is not a reason (except in the often deeply problematic theory of Cultural Relativism). Reasons, in ethics, require appeals to principles and common grounds. In Buddhism, for example, possible principles would include kusala (wholesomeness) or sila (morality) and common grounds would include suffering, ignorance, and the possibility of overcoming both. Each would need further definition and convincing argumentation, but these are the sorts of things needed in ethical discussion.

If someone suggests to you that people are simply bad and that is “just the way it is” you can and should have a ready list of examples of people being good, from the Buddha and Jesus to Gandhi, Martin Luther King Jr, Saint Theresa, and Thich Nhat Hanh. Not to mention countless acts of selfless kindness and even sacrifice; from stories of people acting in moments of disaster and danger to all those who helped Jews and others in the second World War. And hopefully our friend has a parent or friend who has directly helped them in some time of need as well.

The question may always be asked, “but was that really altruistic, or just some other kind of self-serving action?” To this, most philosophers will admit that we have no certain answer, but we can again appeal to our interlocutor: “have you never done anything simply out of care or concern for another person without selfish motives?”

If our friend says no, then we have the classic philosophical problem of “conversing with a sociopath,” in which case we should politely excuse ourselves from conversation.

But if our friend says yes, then it’s clear that this is not “just the way it is,” and that morality, even in a context of an immoral society or world, is possible and worthwhile.

Today I write about Kevin Pham, a man who in the midst of the recent rise of Wells Fargo greed and corruption both spoke up and, when his protests were met with indignation, quit.

Pham was a teller and banker at Wells Fargo from 2008-2010 and saw first-hand the rise of the now widely-known fake accounts scandal. He described the experience as similar to the use of steroids in baseball: it became so endemic that just to keep up everyone had to do it. And, as with baseball (or competitive cycling or concussions in football), the internal power and momentum of the industry and relative weakness of regulating industries, along with a general social attitude of looking the other way, allowed the slow, steady spiral of greed and delusion to reach its destructive ends.

In Forbes, one customer’s experience is recounted:

Anita Robertson, 57 a retiree in Springfield, Oregon, was pitched something like this — a second checking account that the banker said would protect her main account but also help build her credit — but it wreaked havoc on her finances because it was a lot to keep track of the balance on each account. She ended up bouncing a few checks, but when she went in to close the second account a few months after opening it, “they tried real hard talking me out of it, saying, you’ll build your credit this way. We’ll help you and be a good voice for you and then you can come in get loans, buy a home and maybe a car,” she recalls. She eventually did get the account closed but plans to leave Wells Fargo entirely next week as part of the Close Your Account movement.

Pham discusses other ways that accounts were pushed on unknowing customers or simply created out of thin air to boost the apparent “performance” of tellers and bankers, noting that they “especially targeted the financially unsophisticated for these unnecessary accounts…. if [bankers] saw an elderly person walking around, they’d jostle to talk to that person.” The elderly, non-native English speakers, college students, all fodder for the greedy tricksters.

Big business showing just how efficient it could be when freed from the shackles of regulation.

Yet Pham, and no doubt others, had a conscience. In fact there is a class action lawsuit against Wells Fargo by employees who were “punished for not breaking the law.” He did what I ask my students to do: universalize your actions, or consider them in other situations. He found himself asking “Would I sell my mom this or would I be okay with someone selling me this?” Do not make an exception of yourself. And as this sank in, Pham did the right thing. As a result, his numbers fell, he got in trouble, and eventually quit:

When he argued with his manager that what they were doing was wrong, he says she accused him of making excuses for his poor performance. During a discussion with the branch manager who said he was gossiping and bringing down the team and being a negative Nancy, “At that point, I broke down and cried and said I can’t do this anymore and I quit right on the spot,” he says.

And he went further – initiating a #CloseYourAccount day (first held Sept 23 and repeating October 15) with the additional hashtag #HoldWFAccountable. In the below video he says, “What unites us is stopping the powerful from preying on the powerless.”

It is quite possible that such events will come to nothing (or at least fail to have an immediately observable effect). But it might. And it might simply create a small but positive ripple throughout banking communities and the general public. Regardless, it shows that even in a dysfunctional system, we can do better – even if that doing better means quitting.

We need to do better. We need to stand up to unethical actions, small and large. We need more Kevin Phams out there.

Despite my praise, there is one further moral wrench in our story: Pham stands to profit if Wells Fargo shares lose value (he has opened a short position on its stock). In this way he seems to be dipping his toe back into the toxic waters from which he escaped. Importantly, though, he was upfront about this from the beginning. So while this move should furrow our brow perhaps, with regard to his shining the light on a far greater evil, I think this move should not cost him too much of our support.

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