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Wells Fargo says it has hired back 1,780 employees after scandal

On Behalf of | Oct 10, 2017 | Whistleblower Protection

In prepared congressional testimony, Wells Fargo & Co. CEO Tim Sloan recently said that the company has rehired 1,780 employees who had quit or were fired after the bank’s phony accounts scandal. Around 5,300 employees were fired after taking part in the creation of accounts without customers’ knowledge. Wells Fargo says that many others quit or were pushed aside. Some were fired for blowing the whistle on illegal conduct.

Wells Fargo agreed to a $190 million settlement with the Consumer Financial Protection Bureau last year in which it admitted firing the 5,300 workers over allegedly “inappropriate sales conduct.”

The CFPB, however, found the abuses to be systemic, as opposed to caused by employee misconduct. In announcing the settlement, the agency’s director said that “financial incentive programs, if not monitored carefully, carry serious risks that can have serious legal consequences.”

Due to intense pressure to sell additional products to existing customers, Wells Fargo opened over two million deposit and credit card accounts that the customers never requested or authorized, according to the CFBP.

According to Reuters, an internal follow-up investigation found that the bank’s performance system “created pressure on employees to sell unwanted or unneeded products to customers and, in some cases, to open unauthorized accounts.”

“The old sales goals and pressure failed our team members,” Sloan told the Senate Banking Committee. “I apologize for the damage done.”

Further investigations by Wells Fargo found additional abuses, including additional unauthorized accounts. Moreover, Wells admitted finding instances in which car buyers were double-charged for insurance policies which they never agreed to purchase. The banking giant is also facing other scandals.

Reinstatement is often desirable for wrongly terminated employees, as it helps counter some of the reputational damage done by a wrongful firing. It is not the only remedy available to whistleblowers.

As we’ve discussed before on this blog, in most situations it is illegal for employers to retaliate against people who blow the whistle in good faith. Depending on the circumstances, whistleblowers can receive compensation for lost wages, damages and attorney fees — and in some cases punitive damages.

Earlier this year, a former branch manager who blew the whistle on false accounts at Wells Fargo was awarded over $577,500. A bank manager who blew the whistle was awarded $5.4 million.

If you are in a position to notice illegal or unethical behavior at your workplace, you may wish to blow the whistle, especially if it involves fraud on the federal or state government. In government cases, you could be awarded a portion of the total damages the government experienced. Before you take action, however, it’s wise to discuss your situation with a lawyer experienced in whistleblower law.