By Yuka Hayashi 

WASHINGTON -- The Labor Department on Friday ordered Wells Fargo & Co. to reinstate a former employee who was terminated in 2011 after she raised concerns that her subordinates were opening accounts without customer consent.

The department also ordered Wells Fargo to pay the former employee $577,000 in back wages, damages and attorney fees.

The Consumer Financial Protection Bureau, the Office of the Comptroller of the Currency and the Los Angeles City Attorney fined the bank $185 million last September for allegedly opening as many as 2.1 million accounts nationwide by using fictitious or unauthorized customer information.

The order Friday involved a former branch manager in Pomona, Calif., who was fired after reporting suspicious conduct by at least three private bankers working under her. The department didn't identify the former employee.

A Wells Fargo spokeswoman said Friday the bank disagreed with the findings in the preliminary order and would request a full hearing of the matter. "We take seriously the concerns of current and former team members," she said.

The department said the bank could appeal its decision but an appeal doesn't halt the preliminary reinstatement order.

Regulators said last year they found the bank had long ignored hundreds of whistleblower complaints about such sales practices and an employee incentive structure that fueled the conduct. The bank agreed to pay the fine and settled the regulators' allegations without admitting or denying them.

The Labor Department and the Securities and Exchange Commission have been investigating allegations that the bank may have violated whistleblower protection rules by firing employees who reported suspicious conduct. "No banking industry employee should fear retaliation for raising concerns about fraud and practices that violate consumer financial protections," said Barbara Goto, a department regional administrator in San Francisco, on Friday.

The department also ordered Wells Fargo to post a notice informing employees of their whistleblower protections under the law.

Write to Yuka Hayashi at yuka.hayashi@wsj.com

 

(END) Dow Jones Newswires

July 21, 2017 17:11 ET (21:11 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.
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