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Wells Fargo Orders Call-Center Agents To Stop Cross-Selling

By September 15, 2016 at 7:00 am
Wells Fargo ATM (Photo : Justin Sullivan/Getty Images)

Call center workers of Wells Fargo & Co. in the United States were told by the company to temporarily stop cross-selling of financial products to their customers. This follows one day after regulators from the federal government fined the bank when it opened over 2 million unauthorized accounts.

 "We asked the team to pause on the sales part of our calls," says Mary Eshet, a Wells Fargo spokeswoman on Monday.

The bank expected increased volumes of customer calls in reaction to the news about the $185 million settlement. But the suspension does not apply to employees at retail branches. The suspension will also be reviewed at the end of this week.

Moody's Investors said that reports of workers opening unauthorized accounts are "highly disturbing." It added that this could adversely affect the debt holders of the bank.

The strategy of cross-selling multiple financial products to individual customers was the focus of claims made last week by the Los Angeles City Attorney, the Office of the Comptroller of the Currency and the Consumer Financial Protection Bureau. They alleged that Wells Fargo employees are resorting to illegal practices. The bank however didn't deny or admit any wrongdoing.

Wells Fargo is the biggest U.S. bank in terms of market value. But it continues to experience fallouts because of these allegations. The charges include opening accounts without the knowledge of their customers.

The Senate Banking Committee's Democratic members called for hearings into the bank's illegal practice on Monday. In addition, a Wall Street analyst and a number of advocates of adding restrictions on large banks pushed for the pay reduction of top bank executives.

"The regulators' findings are consequential for a bank such as Wells Fargo, which historically has had strong customer satisfaction scores and a reputation for sound risk management," says Allen Tischler, a Moody's analyst. "We do expect some immediate damage to Wells Fargo's reputation from this embarrassing episode," he adds.

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