Wells Fargo & Co. has reached a settlement with a former branch manager who claimed she was fired for blowing the whistle on employees who had been opening accounts without permission, the sales-pressure conduct at issue in a scandal that erupted in 2016.
The settlement, finalized on Jan. 12, brought an end to Wells Fargo’s appeal of a U.S. Department of Labor order compelling the bank to reinstate the fired branch manager, Claudia Ponce de Leon, and pay her $577,500 in back wages, damages and legal fees. That decision came almost a year after Wells Fargo reached a $185 million settlement with federal regulators and the Los Angeles City Attorney’s Office resolving allegations over the widespread misconduct at the bank.
An in-house judge at the Labor Department has ordered Wells Fargo and Ponce de Leon to submit a copy of the settlement agreement by Feb. 9. Ponce de Leon’s lawyer, Yosef Peretz, declined to comment, citing a confidentiality agreement. “All I can [say] at this point is the parties have decided to resolve the dispute,” Peretz said Friday.
A Wells Fargo spokeswoman said in a statement: “The matter has been resolved by mutual agreement of the parties.” An outside lawyer for Wells Fargo at Gibson, Dunn & Crutcher, Karl Nelson, did not immediately respond to requests for comment Friday. Nelson is a labor and employment partner in the firm’s Dallas office.
Wells Fargo has fought Ponce de Leon’s claims for years. In July, the Labor Department ordered the bank to reinstate Ponce de Leon and pay back wages. Wells Fargo promptly appealed the decision last year to an administrative law judge.
In a prepared statement in December, the bank, responding to an inquiry from The National Law Journal, said Ponce de Leon was fired “because other team members repeatedly raised concerns about how she was treating them.” Wells Fargo said labor regulators did not interview several witnesses who could have attested to the conduct cited by the bank.