Whistleblowers from Wells Fargo are coming out of the woodwork. Finally someone is listening. For years, some whistleblowers have been trying to tell the world about all the financial mismanagement at America’s third largest bank ($1.8 trillion in assets, 265,000 employees).
We, of course, have always listened but getting folks to come forward is difficult. Especially when some banks “make an example” of workers who do come forward. Oftentimes it is simply knowing how to report misconduct and finding the right legal help when illegal whistleblower retaliation rears it’s ugly head.
Times are changing both at Wells Fargo and in the broader banking industry. Unfortunately, it took a massive fraud that included opening millions of unauthorized accounts to get Congress’ attention. In the last 24 hours, we have seen the following headlines, “Stumpf’s Departure Won’t Ease Pressure On Wells Fargo”, “Wells Fargo Whistleblower: Once I Complained, They Started Denying Me Bathroom Breaks” and “Wells Fargo Whistleblower: ‘I didn’t know if I’d done the right thing'”.
Without a good lawyer it can take years to get Congress and regulators to listen. Fortunately, Congress recognized this and created both strong whistleblower anti-retaliation provisions and laws that provide financial incentives to those who step forward.
FIRREA and Whistleblower Awards
Chief among the award provisions available for bank employees is the Financial Institutions Reform, Recovery and Enforcement Act and its companion, Financial Institutions Anti Fraud Enforcement Act (FIRREA and FIAFEA respectively).
These laws allow whistleblowers to be awarded a percentage of whatever monies get collected from banks, bank officers or third parties involved in banking fraud. The awards are capped at $1.6 million. The process to collect an award is fairly complex but with the right lawyer, the process becomes painless and easy.
False Claims Act and Whistleblower Awards
If a banking institution commits fraud and the government suffers a loss, the federal False Claims Act can pay even bigger awards. Those awards are up to 30% of whatever the government collects from the wrongdoer with no cap or limit! (One of our whistleblower clients was awarded over $50 million!)
Examples of fraud qualifying for awards under the False Claims Act include TARP fraud and underwriting fraud involving residential mortgages (Fannie Mae, Freddie Mac, VA and FHA) and fraud involving the servicing of residential mortgage loans.
The Future of Wells Fargo
The sudden resignation of Wells Fargo CEO John Stumpf earlier this week is not likely to quell the furor. In fact, we believe that it will have the opposite effect. When employees see that even the CEO of a trillion dollar organization can be toppled, we believe that more and more will feel empowered and ready to blow the whistle.
For years we have been saying that companies need to start listening to employees. Denying bathroom breaks to a bank employee who alerted management about identity theft and accounts being opened without he customer’s permission? Those actions are what turn conscientious employees into whistleblowers. When management won’t listen (or is part of the problem), employees go outside to report their concerns. They also go outside when they suffer retaliation.
If you know of fraud or misconduct within a bank or involving a bank, call us. Our mission is to stop the fraud, protect our clients from illegal retaliation and get them the maximum award possible.
Some companies are now offering an ethics hotline. CNN reports that one Wells Fargo employee called the company’s ethics hotline after being told to illegally open an account. He was fired 8 days later. The company’s Team Member Handbook says that employees should first speak with their manager before escalating concerns. We know that didn’t work because evidence suggests that the managers were being paid huge bonuses for opening accounts.
There is nothing wrong with first brining concerns to management’s attention. Think first, however, and decide whether the illegal or unethical behavior is institutional or the actions of a single rogue employee. For example, if your co-worker or boss is stealing, reporting internally makes sense. But if the wrongdoing is widespread, ignored by management or institutional, remember that internal reporting may get you fired and may prevent you form benefitting from all the anti-retaliation protections available by law.
We are thankful that the media and Congress is finally paying attention to Wells Fargo. The wrongdoing extends well beyond one bank and the unauthorized opening of accounts, however. From sloppy underwriting to improper HAMP denials to the failure to properly pay overtime to bank workers, fraud and greed is everywhere in the banking industry. If you are ready to make a difference, we are ready to help.
MahanyLaw – Bank Fraud Whistleblower Lawyers
We have helped our client whistleblowers collect tens of millions of dollars in award monies. We know the industry and we know our way around the courtroom and the hallways of power in Washington.
If you know of fraud by banks, involving banks or hurting banks, call us. All inquiries are protected by the attorney – client privilege and kept strictly confidential. You never owe us any legal fees or costs unless we are successful collecting money for you.
MahanyLaw – America’s Whistleblower Lawyers
August 2018 Update: Since this post was written in October 2016, bad behavior at Wells Fargo seems to just continue unabated. Even the extremely rare asset cap imposed by the Federal Reserve has done little to slow things down. Visit our new Wells Fargo whistleblowers page for update to date information on the banks shenanigans – Sen. Elizabeth Warren calls the bank a “criminal enterprise” – and what you can do as a banking insider to clean up the bank.