Fired Wells Fargo Staffers File $2.6B Class Action Suit

The New York Daily News reports:

Wells Fargo’s spiraling “sandbagging” scam might get a lot more expensive for the nation’s biggest bank. Two former employees filed a $2.6 billion class action lawsuit last week accusing the bank of demoting or ousting workers who failed to meet “unrealistic quotas” that drove other employees to rip off customers.

“Wells Fargo knew that their unreasonable quotas were driving these unethical behaviors that were used to fraudulently increase their stock price and benefit the CEO at the expense of the low level employees,” the suit says.

The lawsuit, filed Thursday in California Superior Court in Los Angeles County, says the bank pressured workers to open 10 accounts daily and punished those who fell short. It accuses Wells Fargo of wrongful termination, unlawful business practice and failure to pay wages and overtime.

Filed by ex-employees Alexander Polonsky and Brian Zaghi, it seeks compensation for former employees from the past 10 years, as well as current Wells Fargo workers. Polonsky and Zaghi say in the suit they were both demoted, and later fired, for failing to meet quotas without committing fraud.

The suit comes the same month Wells Fargo paid more than $185 million in civil fines for its so-called “sandbagging” scheme, in which thousands of employees opened fraudulent customer accounts to meet quotas.

The Wells Fargo executive who oversaw the scam has retired with a $125 million payout.