Bank of America (BAC) on Wednesday was ordered to rehire and pay $930,000 to a whistleblower who had exposed improprieties at Countrywide Financial. The U.S. Department of Labor ruled BofA violated the whistleblower-protection provisions of Sarbanes-Oxley by improperly firing an employee. The payment includes back wages, interest, compensatory damages and attorney fees.
The findings came after an investigation by the Occupational Safety and Health Administration’s office in San Francisco, which was initiated after it received a complaint from the Los Angeles-area employee.
“It’s clear from our investigation that Bank of America used illegal retaliatory tactics against this employee,” said OSHA Assistant Secretary David Michaels in a press release. “This employee showed great courage reporting potential fraud and standing up for the rights of other employees to do the same.”
The employee originally worked for Countrywide Financial, which merged with BofA in July 2008. The employee led internal investigations that revealed widespread and pervasive wire, mail and bank fraud involving Countrywide employees. The employee alleged that those who attempted to report fraud to Countrywide’s Employee Relations Department suffered persistent retaliation. The employee was fired shortly after the merger.
“Whistleblowers play a vital role in ensuring the integrity of our financial system, as well as the safety of our food, air, water, workplaces and transportation systems,” added Michaels. “This case highlights the importance of defending employees against retaliation when they try to protect the public from the consequences of an employer’s illegal activities.”
Bank of America has a month to appeal can appeal the monetary damages to the Labor Department.
“This is an old matter dating from 2008. We are disappointed with the ruling and plan to exercise our option to challenge the order,” BofA said in a statement. “The bank’s actions to dismiss were solely based on issues with the employee’s management style and in no way related to the employee’s complaints and the allegations made in the complaint.”
“Bank of America encourages associates to raise issues they see. We take such escalations seriously and investigate them thoroughly. We thoroughly investigated the claims made in this case while the associate was still employed and took the appropriate action,” it added. “We do not take actions against associates who raise issues.”
The bank “always takes allegation of fraud seriously,” the statement continued. “The allegations referenced in this complaint were investigated and the appropriate actions taken.”
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