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A proposed $2.6 billion class action lawsuit has been filed by two former Wells Fargo employees in California who say they were terminated after failing to meet unrealistic sales goals by opening up fake customer accounts.
Plaintiffs Alexander Polonsky and Brian Zaghi, two former Wells Fargo employees from Los Angeles, filed the lawsuit in California Superior Court on Thursday.
The pair allege that “Wells Fargo fired or demoted employees who failed to meet unrealistic quotas while at the same time providing promotions to employees who met these quotas by opening fraudulent accounts.”
The plaintiffs detail in their proposed class action lawsuit how certain employees were allegedly “coached” to secretly open fee-generating accounts and often resorted to using false customer contact information on accounts so they couldn’t be traced back, according to the complaint.
Specifically, Polonsky and Zaghi claim that Wells Fargo managers pressed workers to meet quotas of 10 accounts per day, required progress reports several times daily and reprimanded workers who fell short.
Polonsky and Zaghi filed applications matching customer requests and were counseled, demoted and later terminated, the lawsuit says.
“Without firing or demoting employees who failed to perpetuate the scam, Wells Fargo could not sufficiently ‘motivate’ or encourage those employees who met impossible quotas by taking fraudulent and illegal actions to increase ‘cross sells’ so that Wells Fargo’s stock price would double,” the complaint states.
Both Polonsky and Zaghi seek to represent California employees who worked at Wells Fargo in the past 10 years or who continue to work there and were fired, demoted or forced to resign due to not meeting their sales quotas.
It accuses Wells Fargo of wrongful termination, unlawful business practices and failure to pay wages, overtime, and penalties under California law.
“Wells Fargo’s fraudulent scam, which was set at the top and directed toward the bottom, was to squeeze employees to the breaking point so they would cheat customers so that the CEO could drive up the value of Wells Fargo stock and put hundreds of millions of dollars in his own pocket,” the lawsuit states. “Wells Fargo could then place the blame on thousands of $12-an-hour employees.”
According to a recent ABC News article detailing the review of a CFPB document, part of the banks’ alleged fake accounts generated approximately $2 million in fees, while a portion of the alleged fake credit card accounts generated about $400,000 in fees.
“The good employees with a conscience who tried to meet the sales quotas without engaging in fraudulent scams are the biggest victims,” the plaintiffs say. “They are the employees that this lawsuit seeks to redress.”
About 5,300 Wells Fargo employees were reportedly terminated in connection to the fake account allegations.
The California class action lawsuit seems to be just one of many legal problems Wells Fargo is facing over the purported scam to inflate sales metrics by creating fake bank and credit card accounts.
On Sept. 8, the Consumer Financial Protection Bureau (CFPB) fined the bank $100 million. It was also hit with fines from the Office of the Comptroller of the Currency for $35 million and the County and City of Los Angeles for another $50 million.
Wells Fargo also faces a hearing in the House, an investigation from the Department of Justice and was interrogated by the Senate Banking Committee last week.
On Monday, six former Wells Fargo employees filed a class action lawsuit in federal court against the bank seeking $7.2 billion for workers nationwide who were fired or demoted after refusing to open fake accounts.
The federal class action alleges Wells Fargo violated several laws, including Dodd-Frank and the section of Sarbanes-Oxley that prohibits retaliation against whistleblowers.
Moreover, the lawsuit claims Wells Fargo made employees work beyond eight hours a day without paying overtime, violating the Fair Labor Standards Act.
Both the California and federal class action lawsuits say Wells Fargo workers suffered damages including loss of income, back pay as well as “emotional distress” and “mental anguish.”
Additionally, on Sept. 19, three Utah residents filed the first customer class action lawsuit against Wells Fargo over allegations that bank accounts or credit cards were opened or applied for without customers’ knowledge or permission as part of the alleged scam.
Polonsky is represented by Jonathan Delshad of the Law Offices of Jonathan J. Delshad PC.
The Wells Fargo Fake Accounts Class Action Lawsuit is Alexander Polonsky v. Wells Fargo Bank & Company, Case No. BC634475, in the Superior Court of California, County of Los Angeles.
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17 thoughts onWells Fargo Class Action Filed Over Fraud-Related Firings
This is what banks have become now. I worked at a bank from 2004 – 2012, at which time I was terminated. The reason? Tellers had been given a quota of new accounts we had to open in a certain time frame. You read correctly, tellers, the ones who are supposed to take care of customer transactions and get you out the door quickly and accurately, had to talk customers into opening new accounts as well, just like the employees at the desk.I was terminated because I couldn’t make my goals, and I do not do shady things just to meet a goal. In fact many of my coworkers at other branches were terminated for not meeting their goals as well. I spoke with others who worked at different banks, and they all had begun to receive these quotas they had to meet. Of those who didn’t leave and find new careers outside of banking, many were terminated for not reaching their goals. Greed pure and simple. While I understand numbers are important, I also know you cannot force someone to place their money anywhere. But you can provide excellent customer service to keep your customers so they immediately think of you when they need another account.
where do I sign up for wells fargo suit
The case is still moving through the courts and has not yet reached a settlement. Claim forms are usually not made available to consumers until after a court approved settlement is reached. We recommend you sign up for a free account at TopClassActions.com and follow the case. We will update the article with any major case developments or settlement news! Setting up a free account with Top Class Actions will allow you to receive instant updates on ANY article that you ‘Follow’ on our website. A link to creating an account may be found here: https://topclassactions.com/signup/. You can then ‘Follow’ the article above, and get notified immediately when we post updates!
I have always hated Wells Fargo with a passion. For many years when I walked into the bank to pay my mortgage I would be harassed endlessly about opening accounts and the such. to the point I screamed at a teller that asked me for the 100th time and hinted she could not service me if I didn’t open another savings account. I knew back then they were up to no good but couldn’t prove it. How can the same tellers not recognize you when you come in twice a month and ask you again and again the same thing about opening accounts? It took me many years to settle a problem I had with them on my credit card too, until I wrote a nasty letter to them threatening I would go to the media for false advertisement. and when they finally settled with me it was not to my satisfaction as they claimed they lost my records. how convenient was that? so yes, I was scammed too, not just on my credit card but I am sure on my mortgage with them as well as my prior accounts I had with them that I finally closed after being harassed too many times. they even tried to charge me for closing the accounts.
The managers don’t care that the tellers are in the direct line of fire for harassing customers and get yelled at and worse on a daily basis, they just want the numbers so they can get their fat bonus while the tellers are paid crappy wages. Trust and believe, the tellers who constantly harassed you every time they saw you probably dreaded each customer just for the fact that they had to harass them and probably felt bad for being so pushy towards their customers. We had a lot of older customers, wonderful people who had just about every kind of account we had to offer, and it was our job to try and get them to open more, to bring more of their money there.
I loss everything because of Wells my bills couldn’t be paid which lead me to having a life style to life style gone in a year of them and the managers giving me the run around and mess up my accounts its not fair
Yes I want to know what we (the customers) need to do about our accounts that are scam
What about the people they scammed it took my cousin a couple of years to recieve her son deaf benefit. It was horrible they gave her the run around for couple of years. She asked me to help her with it and it was ridiculous!
What about their customers who will eventually pick up the tab for Wells Fargo’s litigation costs? Do all account holders have a claim ?
So was I…Where do we sign up?
The case is still moving through the courts and has not yet reached a settlement. Claim forms are usually not made available to consumers until after a court approved settlement is reached. We recommend you sign up for a free account at TopClassActions.com and follow the case. We will update the article with any major case developments or settlement news! Setting up a free account with Top Class Actions will allow you to receive instant updates on ANY article that you ‘Follow’ on our website. A link to creating an account may be found here: https://topclassactions.com/signup/. You can then ‘Follow’ the article above, and get notified immediately when we post updates!
You can also contact class counsel with any inquiries about the case. Current counsel is listed at the bottom of the article and can be Googled for contact information. Good Luck!
This is just the tip of iceberg, more whistleblowers will now step foreward.
I was a victim of wells Fargo scam, Who do I make contact with in order to take action?
we were also scammed by wells fargo . we were charged with the false insurance check