While the recent congressional hearing targeting John Stumpf, in which Elizabeth Warren
suggested he should resign and be criminally charged,
was nothing more than a "kangaroo court" meant to refocus public anger
on banks, with good reason, the reason why we concluded that nothing
would actually
change is that ultimately there was no evidence
the bank's executive management was aware of the bank's illegal,
fraudulent tactics involving the creation of some 2 million fake
customer accounts to "sandbag" retail banking fees. That assumption,
however, may need revision now that
CNN reports that it has heard from former Wells Fargo
workers
- some of whom were named - around the country, who tried to put a stop
to the bank's illegal tactics only to be met with harsh, prompt and
severe retaliation by the bank.
"Almost half a dozen workers who spoke with us say they paid dearly for trying to do the right thing: they were fired",
CNN says, which if confirmed would promptly make this a criminal case,
which implicate virtually every senior management member, as such
retaliatory practices would suggest not only awareness of what was
happening at the bank, but also an even more dramatic response by
management seeking to keep these practices under wraps.
Some of the named witnesses made it very clear that the narrative spun by Stumpf in Senate was a lie:
"I endured harsh bullying ... defamation of character, and eventually
being pinned for something I didn't do," said Heather Brock, who was
fired earlier this month as a senior business banker at a Wells Fargo
branch in Round Rock, Texas.
"They ruined my life," Bill Bado, a former Wells Fargo banker in Pennsylvania, told CNNMoney.
Bado not only refused orders to open phony bank and credit
accounts. The New Jersey man called an ethics hotline and sent an email
to human resources in September 2013, flagging unethical sales
activities he was being instructed to do. Eight days after that email, a
copy of which CNNMoney obtained, Bado was terminated. The stated
reason? Tardiness.
To be sure, this is not the narrative Stumpf presented before
Congress. Retaliation 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. Indeed, Wells Fargo CEO John
Stumpf made precisely that point on Tuesday 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."
Only, that's not what allegedly happened at Wells. It gets worse:
according to a former HR staffer, Wells had an explicit protocol for
retaliating against "tipsters" - fire them for a minor offense, like
being late.
One former Wells Fargo human resources official, cited by CNN, 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.
CNN's investigation was extensive: it
spoke to a total of four ex-Wells Fargo workers, including
Bado, who believe they were fired because they tipped off the bank
about unethical sales practices. Another six former Wells Fargo
employees told CNNMoney they witnessed similar behavior at Wells Fargo -
even though the company has a policy in place that is supposed to
prevent retaliation against whistleblowers. CNNMoney has taken steps to
confirm that the workers who spoke anonymously did work at Wells Fargo
and in some cases interviewed colleagues who corroborated their reports.
* * *
If the stories are confirmed, it is likely that Wells Fargo would
face legal consequences for any retaliation that occurred against
employees who called the ethics line; furthermore this would implicate
not only the entire HR chain, but also the bank's GC, the entire corner
office and even the Board of Directors.
"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. A number of statutes --
including Sarbanes-Oxley and Dodd-Frank -- "make this unambiguously
clear," Pitt said.
Worse, confirmation of the above allegations would suggest that
Stumpf lied before the Senate, something senator Bob Menendez already
hinted at during the hearing, when he brought up one former employee who
was allegedly 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.
* * *
Back to the termination of Bill Bado, who says the firing took a huge
toll on his life: it put a permanent stain on his securities license,
scaring off other prospective bank employers. Today, the New Jersey
man's house is on the verge of being foreclosed on and he's working
part-time, at Shop-Rite.
"You wonder where the justice is," Bado said.
Wells Fargo confirmed to CNNMoney that Bado had worked there.
However, the bank declined to comment on why Bado left and and on the
ethics complaint with corresponding report number he cited in emails.
"Everything submitted to the EthicsLine is investigated," a Wells Fargo
spokeswoman said. While nobody doubts that, it is what happened next
that is the problem.
While ethics complaints are supposed to be confidential, documents
show that Bado did speak out before he was fired. On September 19, 2013,
Bado wrote an email to a Wells Fargo HR rep and copied his regional
manager, where he detailed improper sales tactics. Documents show Bado
was fired -- for "excessive tardiness" -- just eight days later.
He disputed this justification:
"I have been asked on several occasions to do things that I know are not ethical and would be grounds for discharge," Bado
said in the email to HR. Furthermore, he said a branch manager on "many
occasions" asked him to send out a debit card, "pin it," and enroll
customers in online banking,
"all without the customers (sic) request or knowledge." Those
are precisely the same practices that regulators fined Wells Fargo for
three years later and that senators grilled the bank over this week.
* * *
Bado was not alone: Brock, the business banker from Texas, told
CNNMoney she experienced a similar situation. The 26-year-old single
parent of two young boys was fired soon after she contacted the
company's ethics line about illegal sales practices she witnessed. Wells
Fargo also confirmed Brock used to work at the company but declined to
comment further.
Brock was fired earlier this month, with Wells Fargo accusing her of
falsifying documents - a charge Brock emphatically denies. Brock said
the company bullied her into admitting she did something wrong.
A current Wells Fargo employee who works in Brock's branch vouched for her version of
events.
"That's really scary when you're with a big corporation like this and
HR doesn't have your back," said the current employee, who wished to
remain anonymous so as not to get fired as well.
At least she wasn't fired for also being tardy.
Brock is hoping her story forces meaningful change at Wells Fargo.
"You lose if you do complain and you lose if you don't. What does a
powerless employee do?" Brock said.
* * *
CNN also spoke to Ken Springer, a former FBI agent who runs a firm
that offers a whistleblower hotline service, was alarmed by the
allegations made by former Wells Fargo employees. "That's retaliation.
It's a big problem -- and a perfect example of what shouldn't happen,"
Springer said. "
It looks like there's been a terrible breakdown of checks and balances at Wells Fargo."
In response to CNNMoney's report, a 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.
Alas, the problem is not with employees using the ethics line. It's
what management does right after, and if this report is accurate, as a
probe will likely confirm or deny, then John Stump's days as CEO of the
bank are numbered.
http://www.zerohedge.com/news/2016-09-22/dramatic-twist-wells-fargo-said-retaliate-fire-whistleblowers-who-exposed-banks-ille
