& Co. was fined more than $22 million by the U.S. Labor Department for allegedly firing a senior manager in its commercial banking unit after the employee reported concerns about misconduct to 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 compensatory damages.
Wells Fargo disagrees with the finding and intends to appeal with an administrative law judge, a bank spokeswoman said. The bank’s employees are encouraged to report concerns, she said, adding that Wells Fargo conducts prompt and thorough investigations.
OSHA said Wells Fargo fired the manager illegally when the unnamed employee reported being directed to falsify customer information and expressed concerns over price-fixing and interest-rate collusion to managers and to a corporate ethics line.
The bank fired the employee in 2019, at first offering no reason for the dismissal and then claiming the termination was part of a restructuring process, OSHA said. Investigators later determined that the firing wasn’t consistent with the dismissals of other managers 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. The OSHA Whistleblower Protection Program enforces whistleblower provisions of Sarbanes-Oxley, protecting employees from retaliation after reporting workplace violations of safety and health, securities, tax, criminal antitrust and anti-money-laundering laws, among others.
The fine was a particularly large one for OSHA, said
Jordan Thomas,
a lawyer who helped establish the Securities and Exchange Commission’s whistleblower program who now works at law firm SEC Whistleblower Advocates PLLC.
“Whistleblower advocates view this substantial sanction as a welcome sign of life at OSHA and that Wall Street will not be given a pass on workplace violations,” Mr. Thomas said. “It is a big win that will help other similarly situated financial whistleblowers.”
San Francisco-based Wells Fargo has been the subject of other regulatory action in recent years. In 2020, it reached a $3 billion settlement with the Justice Department and the SEC over its long-running fake accounts scandal. In September 2021, regulators fined Wells Fargo $250 million for a lack of progress in addressing longstanding issues in its mortgage business. 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 notice.
Write to David Smagalla at [email protected]
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