Wells Fargo & Co. was fined more than $22 million by the U.S. Department of Labor for allegedly firing a senior executive in its commercial banking unit after the employee raised concerns about misconduct with company management.
The Labor Department’s Occupational Safety and Health Administration, which imposed the penalty, ordered the bank to pay a Chicago-based whistleblower a range of damages, including back wages, interest, lost bonuses and benefits, and damages.
Wells Fargo disputes the finding and plans to appeal to an administrative law judge, a bank spokesman said. Bank employees are encouraged to report concerns, he said, adding that Wells Fargo conducts prompt and thorough investigations.
OSHA said Wells Fargo fired the manager illegally after the unnamed employee reported being directed to falsify customer information and raised concerns about price-fixing and interest rate collusion to managers and a line of corporate ethics.
The bank fired the employee in 2019, at first without offering a reason for the firing and then claiming the layoff was part of a restructuring process, OSHA said. Investigators later found that the firing was inconsistent with the firings of other managers who were let go during that process.
The employee filed a complaint with OSHA, alleging retaliation under the whistleblower protection provisions of the Sarbanes-Oxley Act, the agency said. OSHA’s Whistleblower Protection Program enforces Sarbanes-Oxley’s whistleblower provisions, protecting employees from retaliation after reporting violations of workplace safety and health, securities, tax, criminal antitrust, and anti-money laundering laws, among others.
The fine was particularly large for OSHA, said Jordan Thomas, an attorney who helped create the Securities and Exchange Commission’s whistleblower program, who now works at the SEC law firm Whistleblower Advocates PLLC.
“Whistleblower advocates see this significant sanction as a welcome sign of life at OSHA and that Wall Street will not get a pass for workplace violations,” said Mr. Thomas. “It’s a big win that will help other financial whistleblowers in a similar position.”
San Francisco-based Wells Fargo has been the subject of other regulatory actions in recent years. In 2020, it reached a $3 billion settlement with the Department of Justice and the SEC over its long-running fake account scandal. In September 2021, regulators fined Wells Fargo $250 million for a lack of progress in addressing long-standing issues with its mortgages. And in May, the bank agreed to pay $7 million in a settlement with the SEC over alleged glitches in a new anti-money laundering system that let suspicious transactions escape initial notification.
Write to David Smagalla at firstname.lastname@example.org
Copyright ©2022 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8