NEW YORK (TIP): Wells Fargo admitted to firing 5,300 employees for engaging in these shocking tactics. The bank earlier this month paid $185 million in penalties and has since apologized.
CNNMoney reports that is hearing from former Wells Fargo workers around the country who tried to put a stop to these illegal tactics and got fired for doing so.
One such account published by CNNMoney quotes Bill Bado, a former Wells Fargo banker in Pennsylvania who was fired for refusing to follow phony account on the pretext of “Tardiness” at work.
Bado had refused orders to open phony bank and credit accounts. The New Jersey man had called an ethics hotline and sent an email to human resources in September 2013, flagging unethical sales activities he was being instructed to do.
HR official describes ‘retaliation’
One former Wells Fargo human resources official even said the bank had a method in place to retaliate against tipsters. He said that Wells Fargo would find ways to fire employees “in retaliation for shining light” on sales issues. It could be as simple as monitoring the employee to find a fault, like showing up a few minutes late on several occasions.
“If this person was supposed to be at the branch at 8:30 a.m. and they showed up at 8:32 a.m, they would fire them,” the former human resources official told CNNMoney, on the condition he remain anonymous out of fear for his career.
It’s possible Wells Fargo could face legal consequences for any retaliation that occurred against employees who called the ethics line.
“It is clearly against the law for any company (or executives of such companies) to try to suppress whistleblowing,” Harvey Pitt, former chairman of the SEC, told CNNMoney in an email.
Retaliating against whistleblowers is a major breach of trust. Ethics hotlines are exactly the kind of safeguards put in place to prevent illegal activity from taking place and provide refuge to employees from dangerous work environments.
Wells Fargo CEO John Stumpf made precisely that point when he testified before angry Senators.
“Each team member, no matter where you are in the organization, is encouraged to raise their hands,” Stumpf told lawmakers. He mentioned the anonymous ethics line, adding, “We want to hear from them.”
The Other side
One former employee was fired after flagging issues directly to Stumpf, according to Senator Bob Menendez.
At the Senate hearing, Menendez read the New Jersey woman’s 2011 email to Stumpf, where she described improper sales tactics she felt were “wrong.”
“Did you read that email?” Menendez asked Stumpf.”I don’t remember that one,” Stumpf replied.”Okay, well she was fired. … So much for the safe haven,” Menendez said.
Elizabeth Warren also unleashed a verbal barrage at Wells Fargo CEO John Stumpf on Tuesday, Sep 20, calling the embattled bank boss “gutless” and demanding he step down.
“You should resign…You should be criminally investigated,” Warren told Stumpf during a fiery one-sided exchange at the Senate Banking Committee’s Wells Fargo hearing.
“If you have no opinions on the most massive fraud that’s hit this bank since the beginning of time, how can it be that you get to continue to collect a paycheck?” Warren asked Stumpf.
Warren slammed Stumpf for failing to fire any senior executives linked to the scandal, while Wells Fargo’s aggressive sales tactics helped pump up the bank’s stock price.
“You squeezed your employees to the breaking point so they would cheat customers and you could drive up the value of your stock and put hundreds of millions of dollars in your own pocket,” Warren added.
Several senators also spoke about the plight of the mostly 5,300, low-level employees who were fired related to the scandal.
In response, Wells Fargo spokeswoman said: “We do not tolerate retaliation against team members who report their concerns in good faith.” She emphasized that employees are encouraged to immediately report unethical behavior to their manager, HR representative or 24-hour ethics line.
Stumpf has apologized for the scandal and on Tuesday admitted the bank didn’t do enough to stop improper sales. He also detailed new steps to try to assess and limit the damage, including expanding an internal search for fake accounts by two years.