Sanctions against the bank have put the severance pay of more than 400 laid-off employees on hold
More than 400 laid-off Wells Fargo employees just got some more bad news – the bank is prohibited from paying them their severance packages, according to a New York Times report.
The Office of the Comptroller of the Currency sanctioned the bank with additional restrictions in November. The restrictions were intended to clamp down on ‘golden parachute’ packages for executives, but the practical effect is that Wells Fargo is unable to make severance payments – worth several million dollars – without regulatory approval.
Former employees affected by the prohibition are from all levels, and were laid off as part of the bank’s regular business adjustments and not because of the recent fake-accounts scandal, the Times reported. Those involved in the scandal are not eligible for severance.
Diana Rodriguez, a spokeswoman for Wells Fargo, said the bank has approached the Office of the Comptroller of the Currency to reconsider its hold, which began in November, but has not been given the go signal yet.
“We are deeply sorry for the hardship this creates for affected team members, and we are doing everything in our power to resolve the situation as quickly as possible,” Rodriguez said.
Wells Fargo has been at the center of controversy since last fall, when it was revealed that bank employees opened 2 million fake accounts in order to meet sales goals.
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Wells Fargo admits to signs of retaliation
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The Office of the Comptroller of the Currency sanctioned the bank with additional restrictions in November. The restrictions were intended to clamp down on ‘golden parachute’ packages for executives, but the practical effect is that Wells Fargo is unable to make severance payments – worth several million dollars – without regulatory approval.
Former employees affected by the prohibition are from all levels, and were laid off as part of the bank’s regular business adjustments and not because of the recent fake-accounts scandal, the Times reported. Those involved in the scandal are not eligible for severance.
Diana Rodriguez, a spokeswoman for Wells Fargo, said the bank has approached the Office of the Comptroller of the Currency to reconsider its hold, which began in November, but has not been given the go signal yet.
“We are deeply sorry for the hardship this creates for affected team members, and we are doing everything in our power to resolve the situation as quickly as possible,” Rodriguez said.
Wells Fargo has been at the center of controversy since last fall, when it was revealed that bank employees opened 2 million fake accounts in order to meet sales goals.
Related stories:
Wells Fargo admits to signs of retaliation
Wells Fargo mortgage referral business dragged down by scandal
