Unit 8 DB: Reflecting on Writing
Unit 8 DB: Reflecting on Writing
Responses: In response to your classmates, consider how your feelings about writing support or contradict their feelings. What advice can you offer them about their own writing and any questions they may have about it?
JOHN’S POST:
I feel like ive gotten a little better at writing. But im still not a fan. Im not great at it and ill continue to learn until i am. Im pretty sure ill be doing alot of writing in business management and ill eventually get there. From wrinting notes to writing dialogues for other employees. There will always be some kind of writing to do. I do not have any question s at the moment. Its still something i need to come out of my shell and do.
ROSA’S POST:
Hello Everyone,
My feelings change because I’m still struggling with writing and this class did teach a lot but my efforts needed to be more than what I was doing, I let my emotions take the best of my work, I have always struggled with writing one because I honestly don’t like writing. Since technology has been so much more advanced I feel like a lot of people lost interest in it especially because there are so many programs we can use to just speak are words to a phone where it automatically types it for us and corrects it at the same time. I would have the wish I did better. I did learn to recheck my work which I never would do so something good about this class that help me was to do that and keep trying,
I believe writing will be used in my career and I will continue working on my spelling and words. I feel that this class will benefit people like me in the long run because it gave me the confidence to try even if I still struggle with writing the most important thing is to put some effort into it and read as much as possible before submitting anything.
Unit 8 DB: Managerial Controls
Unit 8 DB: Managerial Controls
In response to your classmates, discuss what new controls the leadership of the organization should implement in response to the scandal.
AUSTIN’S POST:
Good Evening,
The scandal I will be going over is the Wells Fargo account scandal. One control I believe should have been in place to prevent fraud is Concurrent Control. Also, I believe there were controls used, not to prevent but to enforce the fraud. Top-Down controls are mentioned in this week’s readings and I believe it was used to pressure employees into creating all the fake accounts. The following was said about the incident The bank now admits, according to DOJ officials, that it pressured employees to meet “unrealistic sales goals that led to thousands of employees opening millions of accounts for customers under false pretenses or without customer consent often by misusing customers’ identities.” (2022).
The reason I believe the controls I have selected were ineffective is that to the managers and personnel in charge of monitoring for fraud all the accounts looked normal. It is not uncommon for a person to have multiple accounts with the same bank. So, to those in charge of monitoring for fraud, nothing looked out of the ordinary. This allowed the fraud to continue for over 14 years.
The reason I believe the business didn’t have sufficient controls in place is that those in charge of putting those controls in place ignored them. They were so focused on meeting their sales goals that they were willing to create fake accounts and commit hundreds of millions of dollars in fraud. While also firing any employees for “falsifying records in response to customer complaints, according to court filings, and disciplined tens of thousands more” (2020).
In my opinion, Wells Fargo should have received more punishment than what they got. I hope that if you have Wells Fargo that you consider another bank. If a company is willing to scam and commit what some may see as identity theft on their customers that is something I would not be able to overlook.
Resources
Kelly, J. (2022, April 14). Wells Fargo forced to pay $3 billion for the bank’s fake account scandal. Forbes. Retrieved April 27, 2022, from https://www.forbes.com/sites/jackkelly/2020/02/24/wells-fargo-forced-to-pay-3-billion-for-the-banks-fake-account-scandal/?sh=6929f5fa42d2
Flitter, E. (2020, February 21). The price of Wells Fargo’s fake account scandal grows by $3 billion (published 2020). The New York Times. Retrieved April 27, 2022, from https://www.nytimes.com/2020/02/21/business/wells-fargo-settlement.amp.html
TRACI’S POST:
One can’t help but think of Bernard L. Madoff Investment Securities, LLC when thinking of a scandal and the complete devastation it caused. In short, Madoff was a thief but how he did it under the noses of the SEC and investors was the most fascinating part of the scandal.
1. Yes there were controls in place that could have mitigated the damages that were caused by this Ponzi scheme. David Friehling, Madoffs accountant, and Frank DiPascalli, his right hand man, should have been points of controls. Then there is the SEC (The Securities and Exchange Commission) and even with ongoing investigations into Madoff since 1999, any reports of fraud were simply ignored. Although Madoff had controls that set performance standards and Analyzing deviations, his efforts were saved for the constant chaos his illegal activities generated.
2. Madoff operated with top-down control, other than his accountant and assistant, no one knew how this company truly operated. Madoff maintained full and complete control over his company, for now we know, obvious reasons. I would also say Madoff used Strategic Control when operating his company, enticing investors with a private members investment club and turning away others. Doing so, Madoff was able to steal over $64 billion from investors.
3. These controls were ineffective due to lack of integrity, and ethics. Without these two characteristics operating a corporation or even a small local business, the checks and balances of day to day operations can’t be trusted.
4. I think Madoff purposely put controls in place that he could ultimately oversee and control himself. It has been said that if any employee questioned Mr. Madoff about inconsistencies they were quickly shut down.
5. Madoff was ultimately the reason behind the failure of controls, as was his account and assistant.
Investopedia.com/terms/b/bernard-madoff.asp
courses.lumenlearning.com/wm-principlesofmanagement/chapter/levels-and-type-of-controls
INSTRUCTOR’S RESPONSE TO ME:
Thank you for your post.
Wells Fargo provided an object lesson in what not to do. Do you believe they have made sufficient changes to their operations? Or, could a second scandal of this magnitude happen?
Best regards,
MY POST:
Unit 8 DB: Managerial Controls
I chose the Wells Fargo account fraud scandal. The creation of fake accounts by Wells Fargo, which would have affected more than 1 million customers, drew increased scrutiny from Congress, financial authorities, and the general public.
1.
Wells Fargo could have avoided systematic fraud with the use of technology, and customers and their interests would have been protected as well. Consumers are better sheltered when the appropriate techniques and technologies are in place, such as automated fraud detection and monitoring, fraud assessments that are repeated and performed consistently across entire data sets rather than just individual random money transfers, and early warning schedules that alert to questionable activities before it becomes systemic fraud. Furthermore, Wells Fargo could have done all of this and more by implementing advanced analytics, call recording, and AI technologies, shielding its clients from extensive ethical failure and behavior risk (Klamut).
1.
Cross-selling was the only kind of control that existed. In the Wells Fargo compensation structure, cross-selling was emphasized as a success factor for awarding incentive pay to employees. The system was designed so that the more services a customer uses with Wells Fargo, the more data the bank knows about them, allowing them to make better credit, market, and price choices. The firm also produced scorecards that assessed individual units based on sales factors like cross-selling.
1.
Thousands of workers were able to cheat the company and misrepresent their sale products to reach their goals and claim higher rewards on stress because the corporation failed to carefully manage its cross-selling plan. Rather of considering its consumers as first priority, Wells Fargo created and sustained a cross-selling control plan in which the bank and the majority of its staff did it for themselves, violating banking principles together with the core norm of believe and trust.
1.
Because the corporation put pressure on staff to accomplish unrealistic sales objectives, thousands of employees opened millions of accounts for clients under false identities or without their knowledge, frequently by exploiting customers’ identities. If the Audit team had been granted the power and resources to accomplish their job, the issues might not have arisen. There was no HR existence at the local level for Wells Fargo, which meant that there was no barrier between unethical managers and diligent employees.
1.
The failure was due to a lack of leadership rather than management, particularly in the areas of risk management and risk evaluation. The false accounts that were created caused a considerable lot of harm to Wells Fargo customers, especially those with lower-income holdings.
References
Klamut, Elżbieta. “Internal Audit Tool for Minimizing the Risk of Fraud.” e-Finanse, vol. 14, no. 1, 2018, pp. 49-68.
