Wells Fargo - Do they have a PR department?

On July 13^th 2012, Wells Fargo, the country’s largest mortgage lender, agreed to settle the charges being lead against them from 2004 to 2009. Wells Fargo was charged for implementing higher interest rates and fees on home loans exclusively for the minority community in America. Basically, Wells Fargo had created the equivalent of a racial surtax. This incident has been coined as “reverse redlining”. Back in the days of segregation, banks would refuse people of color loans for their homes. Reverse redlining is giving people of color clearance to buy homes that exceed their salary, loans they cannot afford, and interest rates they cannot pay back. This tanked many upstanding citizens’ credit scores, and created a financial set back that will be affecting the minority community for decades to come.

But what does this have to do with public relations?

An effective public relations team could have nipped this entire thing in the butt. A huge thing I have learned this year is that in a large company or organization the public relations department is most effective when they are involved with the decision making process and NOT just left to clean up after the mess has occurred. Don’t you think that maybe, just MAYBE someone could have foreseen the outrage of the public when it was released that a huge company was targeting Latinos and blacks? Was there anyone in that meeting that said, “Hey! That’s racist!”? Did anyone ask, “What if the public finds out? Are we going to be known as a racist company?”

Listen… public relation departments nation-wide have the ability to affect at least one of the following areas of a company: financial, reputation/brand equity, employees/internal publics, and public policy. Wells Fargo lost a lot of face and all four areas were impacted, they lost money because of the law suit, their reputation was damaged because of the racial discrimination, the bad publicity reflects badly on their employees and some of their employees were probably left in the dark, and lastly their public policy was damaged because it seems the company doesn’t have any respect for the public.

At the end of the day, Wells Fargo is still alive and well regardless of this incident. The public relations angle they are taking is reassuring the public that they will be more transparent, and return to their roots because after all, the company has been around for over 150 years. Eventually, this racial discrimination will be forgotten… well, maybe not entirely. But it will take a lot more than just a law suit to bring this company down.