This case reviews the massive and long-running scandal at Wells Fargo Bank—a scandal whose effects continue to be revealed. The widespread nature of the problems as well as their identified causes provide an opportunity for a comprehensive examination and analysis—one that will incorporate much of the material from this course.

1. How were the problems at Wells Fargo reflective of leadership failure? (20 points)
2. KPMG has been Wells Fargo's auditors since 1931. Did KPMG have a responsibility to discover and report the frauds? Explain. (20 points)
3. Apply the fraud triangle to and discuss the elements of the triangle found in the Wells Fargo scandal. (25 points)
4. Do you believe that KPMG was negligent in auditing Wells Fargo? Why or why not? Note that as a publicly traded company, Wells Fargo was required to have an audit of both the financial statements and internal controls over financial reporting. (25 points)
5. Do you think that Stumpf was aware of the fraudulent actions being taken by bank employees? Why or why not? (20 points)
6. Financial institutions are required to have an internal audit function that is charged with assessing the effectiveness of the internal control system. Did the internal auditors have a responsibility to discover and report the frauds? Explain. (25 points)
7. Multiple employees attempted to alert regulators about the problems at Wells Fargo. In your opinion, why did these whistleblowing efforts fail? (20 points)
8. Assume that you are a senior accountant with Wells Fargo and that you have regulatory compliance responsibilities. You have heard stories about problems in the branches with new accounts and know that the bank has fired 5,300 employees who purportedly carried out the fraud. As a CPA, what are your responsibilities under the AICPA Code of Professional Conduct? (20 points)
9. Assume that you are an internal auditor for the consumer banking division of Wells Fargo. You are concerned about internal audit’s lack of action regarding the branch. You have a good relationship with your manager, and you believe that the manager is open to a discussion. Utilize your Giving Voice to Values (GVV) skills and come up with a plan to talk to the manager about your concerns. What will you say and do? (25 points)

Answer rating: 100% (QA)

There were several failures of leadership that allowed the problems at Wells Fargo to continue for so many years First there was a failure to provide adequate oversight of the bank s sales practices S... View the full answer