Wells Fargo

American banking institution founded during the California Gold Rush (1852) — one of the largest U.S. banks, whose 2016 fake account scandal became the defining case of incentive-driven corporate misconduct.

The Wells Fargo scandal as incentive design failure: the discovery that Wells Fargo employees had opened 3.5 million unauthorized accounts (firing 5,300 employees, paying $185M in fines) became a canonical case study in how aggressive sales incentives can corrupt an entire institution's behavior. Charlie Munger and Warren Buffett (major shareholders) were embarrassed — demonstrating that even sophisticated investors can be blindsided by systematic cultural failures. The lesson: incentive structures, not individual bad actors, produce institutional misconduct at scale.