Whenever a customer or bank notices signs of fraud on the customer's account, the bank is required by law to perform an investigation. It must determine whether criminal activity has occurred and whether the customer was involved. When the customer is involved, the bank immediately closes the account. When the customer is an innocent victim, the bank typically offers at least some assistance in retrieving the stolen money.
Non-compete agreements serve an important purpose: To protect a company's interests after an employee departs. An issue involving non-compete agreements recently entered the news in New York.
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.
In light of a 2016 Supreme Court ruling, the Second Circuit Court of Appeals has ordered a federal court to reconsider the case of two men who tried to blow the whistle on actions by Wells Fargo and two mortgage lenders before the 2008 financial crisis.
There has been a major development in the case of Wells Fargo and the harsh incentives it allegedly put in place to encourage its private bankers to open fraudulent accounts. A former branch manager in Pomona, California, was fired after she brought forward concerns about conduct that she reasonably believed constituted mail, wire and bank fraud to her superiors.