The Wells Fargo Culture

In my book, The Psychopath Epidemic, I talk about how psychopaths in power can influence entire organisational cultures to become psychopathic. Even societies can become psychopathic (for example, Germany in the 1930s and the United States today).

Organisational cultures can become psychopathic to such an extent that the behaviours that should be shunned in fact become something they are proud of.

John Stumpf, the ex-CEO of Wells Fargo, presided over massive consumer fraud. The bank opened two million checking and credit-card bank accounts without the consent of its customers. He didn’t go to jail. But he did get a fine that he could easily afford and a “strongly worded critical letter“… so that’s something, I guess.

As a young man, one of his first jobs was as a repossession agent. Having worked as one of those myself when I was about the same age, it’s a profession well suited to psychopaths. I hated it. It was soul destroying.

Stumpf was known for his folksy sayings:

“When we hire somebody around here, we want to know how much you care, before we care how much you know,” he says, without the slightest hint of irony as we sit with him at his San Francisco office. “We call our employees team members, not employees. Employees denote an expense to be managed. Team members are an asset to be invested in.”

Wells Fargo: The Bank That Works, Forbes, Jan 25, 2012

In this same Forbes article from 2012, they talk about what a heartwarming departure he was from other banking executives:

All of Wells Fargo’s 264,200 “team members” receive a 37-page book, Vision & Values signed by Stumpf, full of warmed-over prescriptions for how to behave, treat customers and, above all, increase revenue. But in a field where sayings like “every man for himself” and “eat what you kill” have led to blunders of historic scale, it’s also a welcome departure.

Wells Fargo: The Bank That Works, Forbes, Jan 25, 2012

Which I guess just goes to show that we should never believe corporate PR.

Disclaimer: I’m not suggesting Stumpf or any Wells Fargo people are psychopaths. But this is the kind of behaviour we should expect from psychopaths and psychopathic organisational cultures.

PS: Warren Buffett’s Berkshire Hathaway are the biggest shareholder in Wells Fargo. Charlie Munger, Buffett’s partner, calls what happened at Wells a “blind spot”. Warren referred to it as a “big mistake“. As listeners of our investing podcast, QAV, would know, I’m a big fan of both Buffett and Munger, certainly as investors, and they have a reputation for very high ethical standards. And I don’t expect investors to be responsible for corporate culture of the companies they invest in. But it’s disappointing to hear them dismiss this kind of behaviour as just big mistakes and blind spots.

Cum-ex Psychopaths

The financial services industry is reputed to be over-represented with psychopaths. In my book I talk about the recent Australia Banking Royal Commission as one example of how the industry seems to attract them en masse. It’s hard to read this story about “cum-ex” fraud without thinking a lot of the people tied up in it, including the lawyers, might be psychopaths.

One of the German lawyers involved in stealing tens of billions of dollars from public treasuries reputedly said:

“Whoever has a problem with the fact that because of our work there are fewer kindergartens being built,” Dr. Berger reportedly said, “here’s the door.”

This is why I argue that the number one thing we can do to stop psychopaths from destroying the world is to implement psychopath tests of all managers across all kinds of organisations.

No half measures

One of the guys who created the CIA torture program says that waterboarding a prisoner, who has been held in jail for 13 years and never charged with a crime, over 80 times, only “verged” on breaking the law. Gee, I’d hate to see what ACTUALLY breaking the law looks like.

Imagine what kind of person you have to be to get paid $80 million to design a torture program.

Do you think ScoMo is a psychopath?

As part of World Psychopath Day, we’re taking a poll on how many people think Australian Prime Minister Scott Morrison, aka ScoMo, aka ProMo, aka Scotty From Marketing, might be a psychopath.

Of course, this doesn’t suggest he *is* clinically diagnosed as a psychopath, it’s just a measure of public opinion.

And don’t forget to buy a copy of my new book The Psychopath Epidemic, out now!

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