Wells Fargo fired up to 125 employees for allegedly misrepresenting themselves to obtain stimulus money intended to help businesses hurt by the COVID-19 pandemic.
CNN, citing an internal memo written by Wells Fargo’s head of human resources, David Galloreese, reported the misrepresentations may have amounted to fraud against the U.S. Small Business Administration. An internal investigation is ongoing, CNN reported.
In the memo, David Galloreese wrote that the bank identified employees whom it believes may have “defrauded the U.S. Small Business Administration (SBA) by making false representations in applying for coronavirus relief funds for themselves through the Economic Injury Disaster Loan program, which is administered directly through the SBA.”
Galloreese wrote the employees’ actions did not involve customers and were taken outside of their responsibilities at the company.
“We have zero tolerance for fraudulent behavior and will continue to look into these matters,” Galloreese wrote. “If we identify additional wrongdoing by employees, we will take appropriate action.” He said the company would fully cooperate with law enforcement.
“As a company, we are vigilant in detecting fraud,” he said. “While these instances of wrongdoing are extremely unfortunate and disappointing, they are not representative of the high integrity of the vast majority of Wells Fargo employees.”
In 2016, the Consumer Financial Protection Bureau fined the bank $185 million over allegations it created millions of fraudulent savings accounts and checking accounts. In 2018, the Federal Reserve announced it was capping the bank’s assets citing “widespread consumer abuse.”
Last month, JPMorgan Chase the largest lender under the Paycheck Protection Program, said some of its employees had “fallen short” of company standards and participated in conduct around the program that may have been illegal. The bank reportedly fired several employees who improperly applied for COVID-19 relief funds through the Economic Injury Disaster Loan program.
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