Former Wells Fargo employees are seeking over $7.2 billion in damages for workers nationwide who were terminated or demoted after refusing to open unauthorized accounts. The troubled bank was accused of devising a “fraudulent scheme” to increase its stock price with nearly two million fake accounts.
The former employees filed a class action lawsuit alleging wrongful termination, retaliation, failure to pay wages and other labor code violations. Employees were allegedly forced to “choose between keeping their jobs and opening unauthorized accounts,” according to the complaint. The legal action builds on an initial complaint filed by two former California Wells Fargo employees in Los Angeles Superior Court.
Brian Zaghi and Alexander Polonsky said they were fired after failing to meet unreasonable sales quotas of opening 10 accounts each day. They claimed Wells Fargo fired them as an example to other employees. The lawsuit alleged employees who opened fake accounts were often promoted while those who refused to participate in the scheme were systematically and routinely terminated.
According to the complaint, Zaghi and Polonsky said Wells Fargo managers constantly checked on employees and their progress toward quotas. Employees who failed to achieve their daily sales goals had to work extra hours without overtime pay. Workers were told “to do whatever it takes to reach their quotas.”
The lawsuit represents Wells Fargo employees of the past 10 years who were fired, demoted or forced to quit. They are seeking damages for back pay, loss of income, mental anguish and emotional distress.
Several senators have voiced concerns about Wells Fargo’s employment practices. The bank has been accused of reporting vague and incorrect information about employees to the Financial Industry Regulatory Authority in retaliation for blowing the whistle on the unauthorized accounts. The inaccurate filings would prevent workers from finding jobs elsewhere in the banking industry.