Lisa Banks Publishes Article on Wells Fargo Scandal in CCI

Katz Banks Kumin partner Lisa Banks and associate Mehreen Rasheed coauthored an article for Corporate Compliance Insights (CCI) entitled, "Wells Fargo Complaints Show Flaws in Federal Whistleblower Program."  In the article published on December 9, 2016, Ms. Banks and Rasheed discussed how the recent Wells Fargo scandal reflects weaknesses in the federal whistleblower program. Last fall, regulators discovered that the company created over 2 million unauthorized customer accounts between May 2011 and July 2015. As a result, the bank paid $185 million in civil fines. Wells Fargo employees cited pressure from management to meet sales quotas, which included threats of termination, as an incentive to create these fake accounts. Several employees who were terminated for not meeting their sales quota filed complaints that alleged retaliation for blowing the whistle on these practices. Commenting on the trend, the authors said, "Emerging reports indicate that swifter investigation and processing of whistleblower complaints could have brought satisfaction to the whistleblowers' cases and uncovered the scandal earlier." They note that Wells Fargo employees "began filing complaints related to the creation of unauthorized accounts" to OSHA as early as 2009.

However, investigation delays are not new to OSHA, given the breadth of its mandate and the volume of whistleblower complaints filed.  OSHA has only 88 full-time investigators nationwide to address complaints, which totaled over 3,000 last year, brought under 22 federal statutes. Ms. Banks and Rasheed conclude, "If the years of audits and reviews make anything clear, it is that OSHA is in need of sufficient resources and a robust system to ensure streamlined and thorough investigations from start to finish, as well as organized and timely communication with other federal agencies." Whether or not improvements to the review process will take place under the new administration is yet to be seen; however, Ms. Banks and Rasheed note that one way or another, change is likely on the horizon.