Employee Dismissals Come into Question
Senator Bob Casey dragged Wells Fargo & Co (NYSE:WFC) back into the spotlight on Wednesday, November 16, by asking a regulatory body to see whether or not the bank fired employees who complained about its unfair sales practices.
Casey was referencing the 5,300 employees that Wells Fargo let go in relation to its sales incentive program, which led to the opening of two million unauthorized accounts. The contention is that employees felt so compelled to meet sales targets that they opened fraudulent accounts.
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It is a story that has received much attention in recent months. Wells Fargo settled and paid a $185.0-million fine over those allegations, and has reviewed the accounts of customers who were affected, but it has not admitted wrongdoing. As a result, the bank’s upper management was hauled before U.S. Congress and thrashed on their turning a blind eye to the abuses. Senator Elizabeth Warren even pushed for (and achieved) the removal of John Stumpf as chief executive officer.
But Casey obviously thinks the bank did more than turn a blind eye—he suggests that it knowingly dismissed employees that were uncomfortable with the sales program. (Source: “Senator Pushes Finra to Expedite Reviews of Wells Fargo Employee Dismissals,” The Wall Street Journal, November 16, 2016.)
“Wells Fargo appears to have terminated employees because they either refused to break the law, or reported unauthorized and abusive activity to their supervisors, the Wells Fargo ethics hotline or human resources,” said Casey’s letter, written to the Financial Industry Regulatory Authority (FINRA).
The agency is an industry-run regulatory body. It is currently looking at 600 Wells Fargo employees who were dismissed using “Form U5s,” filings, which can affect the future employability of those workers. Some of the dismissed workers say their U5s contained inaccurate information that adversely impacted their job prospects. Not only that, but they say the dismissals took place shortly after they complained about the unreachable cross-selling targets.
The implication is that Wells Fargo exacted punishment on employees who spoke out against a flawed incentive scheme. If true, those workers need their reputations restored so they can seek alternate employment, says Casey.
“Finra can improve the chances that someone can move forward with their life,” Casey wrote. “It is bad enough to lose your job. But it’s made ever more complicated and burdensome if you’re trying to find a job and this isn’t clarified.”
