Sales pressure at companies like Wells Fargo can force employees to sometimes skirt the law in order to reach otherwise unattainable goals. (Photo via Flickr)
It’s a choice nobody should ever have to make: break the law or lose your job.
But that’s exactly the choice that companies like Wells Fargo force on their employees when they set unrealistic sales goals and apply immense pressure to meet them.
Wells Fargo was fined $185 million in September after thousands of employees created more than 2 million fake or unrequested accounts in order to meet sales targets. In the weeks since the fine was levied, Wells Fargo CEO John Stumpf resigned and the company’s stock price has plummeted.
The press has reported that several employees over the years tried to tell management there was a problem, but none of the top-brass wanted to listen.
“Everybody knew there was fraud going on, and the people trying to flag it were the ones who got in trouble,” Ricky M. Hansen Jr., a former Wells Fargo branch manager in Scottsdale, Ariz., told the New York Times.
Though the mega-bank has captivated headlines lately, it is hardly the first time a company has been accused of pushing employees so far they resort to breaking the law.
For example, Quicken Loans, one of the largest mortgage lenders in the US, was caught up in accusations of harmful sales tactics. In sworn statements, some former Quicken employees said they felt as if company executives were “training monkeys to sell their products to customers” and they “were berated, screamed at, and had our jobs threatened to increase our sales.” In 2011, a judge ordered Quicken Loans to pay more than $2.7 million for allegedly defrauding a borrower by inflating the value of her home by 300 percent.
Pharmaceutical companies also have been known to pressure sales employees to reach certain quotas and provide large financial incentives to encourage employees to push “off-label” sales – even if that involves providing false information about the effectiveness of the drugs and ignoring dangerous side effects. Sometimes pharma companies pay kickbacks to doctors in various forms to encourage them to prescribe the companies’ drugs so that the companies’ sales will increase.
Recent charges against two former sales employees at Insys Therapeutics, which makes a fast-acting fentanyl spray for cancer patients who suffer pain despite taking other opioids, highlight this tactic. When it looked like the company might miss its quarterly sales projection for the first time in company history, one of the former employees named in the complaint allegedly sent out an email to employees urging them to put pressure on doctors to prescribe more of the company’s product, Subsys.
“There is no excuse for any of your docs to not take care of you at this crucial time of the quarter,” the email said.
Insys has acknowledged in the past the company is under federal investigation for its sales practices, though the company is not named in this specific indictment.
Whistleblowers can help bring an end to these types of sales practices that hurt both employees and consumers. When their voices are silenced or ignored by management (which often happens), employees might under certain government whistleblower programs be able to spark an investigation, stop the abusive or dangerous practices, protect their jobs and earn a reward.
Depending on the type of sales practices, a whistleblower may file a whistleblower lawsuit under the False Claims Act or submit a whistleblower claim with the Securities and Exchange Commission or the Commodity Futures Trading Commission.
Though C-suite executives don’t always listen when an employee speaks up, they usually find it hard to ignore a knock on their door from a federal investigator.