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 (Wells Fargo Phony Accounts, September 4, 2017).
That number has increased since then (Well Fargo Fake Accounts Increased, August 31, 2017).
Further more, Wells Fargo has also been accused of forcing customers to buy car insurance they did not need, charging mortgage fees they did not incur, using high fee debt products to take advantage of investors, overcharging small businesses with excessive credit card fees etc. (Wells Fargo Overcharging, July 13, 2018).
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/fraud. You are also aware of auditing procedures the auditors can use to test for and detect material errors/fraud.
Your assignment is to write a persuasive argument for your opinion on the following question: Part 1- Who is more at fault management or the auditor? Often, there is a shared responsibility for such failures. However, your task is to determine whose failure was greatest and why. You will need to acknowledge why the other side also failed (the side you are not arguing for) and then defend why your side’s failure was greater.
Part 2- You will need to demonstrate that you understand and can apply the information learned in class up to this point. You must also detail what internal controls were not operating properly, were not designed properly or were missing (in your opinion) in order for that scandal to have occurred. You must also indicate what controls should have been put into place, meaning had they been operating this scandal would not have occurred.
Guidance: The majority of this assignment should be spent on part 2 (above).
This is an individual assignment. Any student found to have copied or plagiarized any part of this assignment will receive a 0.
You will be graded on the content of your report, how well-written your report is and effectively you presented your argument.
1. You will need to specifically list which Wells Fargo failure you have chosen to address (the fake accounts, mortgage scandal, the auto insurance, etc.) upfront in the introduction. Just pick one scandal.
You may choose another banking scandal or accounting scandal other than the Wells Fargo example. However, you must get the professor’s approval prior to starting the assignment. Failure to do so will result in a 0. This is instruction is only for those who will not be using a Wells Fargo scandal for their assignment.
2. You will need to address what policies or procedures (controls) failed and your opinion on what policies or procedures (controls) that should have been in place to have prevented or better detect this failure. You must indicate whether your controls are preventative or detective. Here is an example to start with (Example of Wells Fargo control deficiency , May 20, 2018). However, you need to formulate your own examples as well.
3. The reports must be turned on time. No exceptions. No late assignments accepted.
4. The reported must be 4 to 8 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. AGAIN!!! 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. You may use any sources that are appropriate for this assignment. You do not have to use any of the ones that I have listed on this document. However, if you do, they must be properly cited.
8. 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.
Feel free to research and find your own sources. Below I have listed just a few articles that might be helpful to start with.
Wells Fargo Scandal Timeline – You may further investigate by clicking on the links within this article.
Senator Questions CEO – possible control issues (if you look hard enough)
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