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Whistle Blown On Wells-Fargo Fraud

ECG monitor What is Whistleblowing?

Whistleblowing is reporting organized fraudulent conduct through the appropriate channels. This could mean reporting by filing a case on behalf of the federal or state governments under the False Claims Act, allowing for the whistleblower to obtain a percentage of up to 30% of what the government recovers. This reward is also paid to whistleblowers reporting financial fraud to the Securities and Exchange Commission whistleblower program or whistleblowers who file claims through the IRS whistleblower program. In the news, numerous cases have been reported in which the government has been defrauded by corporations. For example, billing Medicare for services that were not medically necessary in skilled nursing facilities or nursing homes.

Whistleblowing is fast becoming recognized as one way to protect the taxpayers from major fraud schemes. For example banks are not allowed to launder moneys of criminal organizations including drug cartels. Yet because money laundering for drug cartels is so lucrative, many banks still do it. When reported to the Government through whistleblowers, the banks pay large fines and sometimes individuals are prosecuted for this wrongdoing. It is generally understood that assisting drug cartels hurts our country. Also, when large corporations evade taxes or when individuals try to evade taxes by hiding funds off shore, this hurts other citizens who pay their taxes fairly. Whistleblower who report this wrongdoing are strengthening our nation by punishing those who cheat.

The Curious Case of Wells-Fargo

In 2010, Wells-Fargo—a company with a purported reach of 1 in 3 U.S. households, fired an unnamed manager who claimed to have received positive performance appraisals up until his sudden dismissal. Then in September 2016, it was discovered that Wells-Fargo employees purposefully falsified millions of bank accounts without the permission of their customers; a tactic dating back to 2011 that helped employees increase sales figures, make budget projections and even acquire bonuses.

The manager who was fired mere months before the secret-account chain commenced, allegedly alerted senior bank personnel about suspected fraudulent activity. And according to the Labor Department’s Occupational Safety and Health Administration (OSHA), he was fired because of those alerts.

Presently, the former manager’s whistleblowing warnings are not directly linked to the millions of sham accounts created.

In April 2017, Wells-Fargo was ordered to pay the ex-manager a total of $5.4 million dollars in compensation as well as for the cost of legal fees and back pay as OSHA ordered the bank to rehire him. Wells Fargo & Co. also paid $142 million in a class-action settlement to customers whose credit scores have been hurt by its employees’ much-maligned practices of creating fake accounts at bank branches.

And to further fan the flames, the once general manager at Wells-Fargo, Claudia Ponce de Leon, averred that she informed her superiors on multiple occasions about fake accounts being entered in the system in mid-2011, though she too was let go.

CNN Money has stated that several other employees were fired after contacting the bank’s ethics hotline and Wells-Fargo themselves have admitted that some whistleblowers were unjustly terminated.

Wells Fargo is in for another scandal. This time, for signing up 490,000 auto-loan customers for insurance they didn’t need. This comes less than a year after the bank generated a massive public outcry for opening millions of unwanted accounts for customers. Customers had no idea they were being charged for this insurance from Wells Fargo. And the bank acknowledges that tens of thousands of people wound up in default, which affected people’s credit scores, and thousands had their cars repossessed. Read more here.

Whistleblowing isn't Difficult - You Just Need To Know How It Works

How can you know if you have a good whistleblower case? First, the information should be unique and not already published publicly. Secondly, you generally need some sort of corroboration in the form of documents or emails or other confirming information. Third, you should not speak with others about what you are intending to do as disclosure to others may remove your rights to recover any reward. Fourth, in most cases you should seek experienced legal counsel to review everything confidentially and confirm that the information confirms a viable case. Check different parts of this web site for topics which might show similar cases taken in the past.

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