A-5
Implementation of Cross-Sell at the Community Bank
13. In contrast to the Company’s public statements and disclosures about needs-based
selling, Executive A implemented a volume-based sales model in which employees were
directed, pressured, and/or caused to sell large volumes of products to existing customers, often
with little regard to actual customer need or expected use. From at least as early as 2002 to
approximately 2013, Community Bank leadership, including Executive A, directly and/or
indirectly encouraged, caused, and approved sales plans that called for aggressive annual growth
in a number of basic banking products, such as checking and savings accounts, debit cards, credit
cards, and bill pay accounts.
14. By approximately 2010, in light of existing product penetration, shifting demand,
macroeconomic conditions, and regulatory developments that made certain products—such as
checking accounts—less profitable, the sales plans were regarded in various parts of the
Community Bank as far too high to be met by selling products that customers actually wanted,
needed, or would use. Nevertheless, the number of products sold continued to be a significant
criterion by which the performance of employees, ranging from tellers and bankers to RBEs, was
evaluated. Throughout the Community Bank, managers responded to the increasing difficulty of
growing sales by exerting extreme pressure on subordinates to achieve sales goals, including
explicitly directing and/or implicitly encouraging employees to engage in various forms of
unlawful and unethical conduct to meet increasing sales goals. Many employees believed that a
failure to meet their sales goal would result in poor job evaluations, disciplinary action, and/or
termination. Though there had been evidence of employees struggling to ethically meet sales
goals as early as 2002, the problem became significantly more acute beginning in 2010 as the