Since the exposure of millions of unauthorized accounts opened by Wells Fargo N.A., the national banking chain has faced $185 million in fines, fired more than 5,300 workers and seen its chief executive face withering criticism by federal officials in Washington.
But in the years before the fines and sanctions, other Wells Fargo employees took their employer to court to call attention to alleged wrongdoing at its banks – and some paid with their jobs. One of those whistleblowers was Yesenia Guitron, who was fired from the company’s St. Helena branch in 2010 after less than two years on the job. She then unsuccessfully sued the bank in federal court for retaliatory behavior and discrimination.
Now, as stories proliferate about sham accounts in relatives’ names, unneeded credit cards issued without customers’ knowledge, and other shenanigans that padded bankers’ commissions and kept them afloat in an atmosphere of unrealistically high sales goals, Guitron – who never returned to banking after leaving Wells Fargo – describes herself as the least surprised of witnesses to the fallout.
“The only way to meet your goals in that situation is if you game the system. Nobody did anything to stop it,” she said last week of the misconduct she called the inevitable result of a Wells Fargo directive that its workers upsell customers with as many extra products as possible – regardless of their need or understanding of them – or else face poor performance reviews or even the loss of their jobs.
Guitron spelled out her allegations in a 2010 lawsuit against Wells Fargo in U.S. District Court in San Francisco, but the court declined to award her damages, ruling that bank’s sales targets – even if unreasonable – were not illegal and could still be used to measure job performance. An appeal in 2015 also failed, leaving the divorced mother of two with an $18,000 legal bill.
The bank’s sales yardsticks are at the heart of a controversy that gained attention in December 2013, when a Los Angeles Times investigation revealed endless pressure on Wells Fargo staff to cross-sell everything from ordinary savings accounts to bank cards, mortgages and wealth management – all generating extra fees and locking customers firmly to the company.
Quotas on so-called “daily solutions” were strict, with bankers in larger cities required to sign up visitors for as many as 15 new products per day. Executives with the banking giant highlighted its “cross-sale ratio,” the number of products sold to individual customers, which in recent years has reached about six per person.
Even in St. Helena, with only 6,000 residents and a shallower customer pool, there was little relief from company sales targets, according to Guitron, who joined the local branch in March 2008 after previously working for Westamerica, Bank of the West and Bank of America.
“We would have morning meetings – they called it the powwow – where they would emphasize the product of the day,” she recalled on Monday. Her branch manager challenged all the bankers and reminded them, “You have to make eight solutions a day.”
“Each banker needed to come up with a minimum of eight solutions a day; if a banker finished their eight a day by noon, they got to go home early. There was a big emphasis on tellers to ‘get cheeks on chairs,’ meaning to send them to a banker’s chair.”
Three months after her hiring in St. Helena, Guitron noticed a colleague opening and closing accounts without telling customers, Guitron said in the federal complaint she filed in August 2010, seven months after leaving Wells Fargo.
In an interview with the Register, Guitron described a scale of commissions for each service an employee sold to a customer, from $8 for opening a basic checking account to $25 for selling a premium account requiring a higher balance. Since a banker could score $3 to $5 for each debit card issued to a customer, some employees would quietly issue as many as 10 cards in the same person’s name – pocketing the commissions even for cards that were never activated or used, she said.
“I started noticing a very clear pattern of accounts opening and closing for the same customer, with no explanation,” recalled Guitron. “… People would come back (to the branch) because they said, ‘I’m getting collection calls because I have a credit card from Wells Fargo that I never opened,’ recalled Guitron. “The annual fee for rewards was charged against the card, and then six months out, these accounts would get charged off and go to collection agencies who said ‘You owe money,’ and then the customers would say ‘No, I didn’t do that.’
“So then the bankers would say it was identity theft – and then sell them identity theft protection. These customers were being juiced left and right.”
By March 2009, she began complaining to her supervisor, who still works for Wells Fargo in private banking, about the co-worker’s continued opening of rogue accounts and the number of customers receiving service charges for bank accounts they had never approved, according to court documents. But her alerts to superiors up the chain of command – first to human resources officers, then to regional and area managers, and finally an email to CEO John Stumpf – brought no end to the repeated opening of unnecessary accounts, Guitron said.
That August, Guitron later told the federal court, the tide turned against her within the St. Helena bank. She received a negative performance review, two managers accused her of having an affair with a colleague, and she was required to make written requests to leave the bank branch, even to take her daughter to or from day care, according to her complaint.
The end came in January 2010, when her boss ordered Guitron to clear her desk and then escorted her from the St. Helena building, according to the former banker and court records. When another bank manager called Guitron a few days later to claim the firing was a misunderstanding and that she should return to work, she declined, leaving the bank to record her departure as a resignation.
Seven months after she was forced from Wells Fargo, Guitron and another St. Helena employee, Judi Klosek, sued both Wells Fargo as well as the St. Helena manager personally. “I felt a bit like Erin Brockovich, little me going up against big Wells Fargo,” Guitron said Monday.
But in July 2012, the federal court ruled against them, saying that Wells Fargo’s sales targets, even if unreasonable, affected all employees equally and did not target Guitron alone.
“Despite their assertions to the contrary, Plaintiffs have not introduced evidence that Defendants inconsistently implemented their personnel management policies, or that others who performed similarly were not given such warnings,” District Judge Claudia Wilken wrote in her ruling. The court also turned aside Guitron’s claims that bank managers had harassed and discriminated against her based on her being divorced and a single parent.
After Guitron recounted her experiences in St. Helena during a Tuesday interview for “CBS This Morning,” Wells Fargo sent the network a statement saying “we do not tolerate retaliation against team members who report their concerns,” but agreeing with the court’s ruling against its former employee.
On Friday, Wells Fargo issued a statement to the Register.
“Wells Fargo’s culture is committed to the best interests of our customers, providing them with only the products they want and value. We also are committed to having a supportive, caring, and ethical environment for team members,” the bank said.
“We regret and take full responsibility for the incidents in which customers received a product they did not request, as that is inconsistent with the values and culture we strive to live up to every day.
“We have made fundamental changes to help ensure team members are not being pressured to sell products, customers are receiving the right solutions for their financial needs, our customer-focused culture is upheld at all times and that customer satisfaction is high. This includes our recent announcement that we are ending all product sales goals for the retail bank, effective October 1st.”
“The judge did dismiss Yesenia Guitron’s claim and we agree with the judge’s finding that her claims of retaliation had no merit,” the bank said.
The experience marked the end of a banking career for Guitron, who since 2011 has worked as the property manager for an affordable housing complex in St. Helena. Even in her current line of work, she said, traces of suspicious bank activity continue to cross her desk.
“I verify tenants’ eligibility each year, including looking at bank account assets,” she said. “To this day I continue to see tenants have a brand-new account number every year and when I ask why, they say, ‘Oh, the banker told me there was a problem with the old account, so they had to close it and start a new one.’ So I still see this happening today.”
In the years since Guitron left Wells Fargo, the accusations she made have been amplified by numerous others.
On Sept. 8, Los Angeles county, city and federal regulators imposed a combined $185 million in fines against Wells Fargo for creating more than 2 million unauthorized bank and credit card accounts. The company also agreed to pay back $2.6 million in fees connected with unasked-for products, California and Illinois have suspended their investment activities with the firm for the next year.
Six years after Guitron tried to take on Wells Fargo nearly singlehanded, hundreds of others are teaming on a federal class-action lawsuit seeking $7.2 billion from the bank for firing or disciplining those who refused to open fake accounts. Nearly 1,000 plaintiffs have signed onto the suit in the Central District in Southern California, according to their lawyer, Jonathan Delshad.
“It wasn’t hard to meet those goals – all they had to do was open 10 accounts for their mom and 30 more for their sister,” he said of Wells Fargo’s sales practices.
Stories such as Guitron’s show the need not only to restore the losses of Wells Fargo customers but to do justice to employees who had to face down the bank alone, according to Delshad.
“They’re sufficiently upset that for years they’ve tried to tell the story and no one’s been listening,” he said Thursday. “Unfortunately, I feel they’re being left in the dust because all the focus is on the customers. Wells Fargo has said thousands of times they would make things right by the customer, but they haven’t said anything about making things right by their former employees, people who were fired simply because they weren’t meeting the quotas.
“We know a different story now; we know the extent of the fraud. Anyone looking at this case from the 5,000-foot level can see that when you have 5,300 people getting fired across the nation, something was going wrong at the top that was being pushed down.”
Back in the Napa Valley, Guitron has shared the story of her whistleblowing experience with the New York Times, CBS and other media outlets, hoping that accountability for the scandal goes beyond the mostly rank-and-file bank workers who have lost their jobs.
Stumpf, Wells Fargo’s CEO, has faced tough questioning in the past month by the Senate Banking Committee and the House Financial Services Committee, which on Sept. 29 pressed him on what senior managers knew about allegedly illegal sales practices and when any concerns were disclosed.
Earlier, at a Sept. 20 hearing, Sen. Elizabeth Warren, D-Mass., told Stumpf to resign and “give back the money you took while the scam was going on.” Senators also dismissed assertions that senior Wells Fargo executives were unaware of the wrongdoing until 2013, despite whistleblowers pointing to the opening of suspect bank accounts years earlier.
“Obviously they’re protecting the bad guys because they produced money for the company,” said Guitron. “I know it happens across the nation, not just this little town. My hope is that banking goes back to the way it used to be, where you served the customers and helped them achieve their financial goals, not your financial goals.
“That would be my wish. If Wells Fargo wanted to make things right, they would stop protecting these people.”
Information from The Associated Press was used in this report.
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