In the wake of the Wells Fargo scandal, the Consumer Financial Protection Bureau has issued a bulletin warning banks that creating incentives for employees and service providers to meet sales and other business goals can lead to consumer harm. "Tying bonuses or employment status to unrealistic sales goals or to the terms of transactions may intentionally or unintentionally encourage illegal practices such as unauthorized account openings, unauthorized opt-ins to overdraft services, deceptive sales tactics, and steering consumers into less favorable products," the CFPB wrote. The bulletin outlines various steps that institutions can and should take to detect, prevent, and correct such production incentives so that they do not lead to abuse of consumers.
The CFPB's press statement is here.
The CFPB's bulletin is here.
