Wells Fargo fires more than 100 workers over relief fund abuse
The firm found staffers who it believes defrauded the U.S. Small Business Administration "by making false representations in applying for coronavirus relief funds for themselves," a memo said.
Wells Fargo & Co. fired more than 100 employees for improperly getting coronavirus relief funds, according to a person with knowledge of the situation.
The firm found staffers who it believes defrauded the U.S. Small Business Administration "by making false representations in applying for coronavirus relief funds for themselves," according to an internal memo reviewed by Bloomberg. The abuse was tied to the Economic Injury Disaster Loan program and was outside the employees' roles at the bank, according to the memo.
"We have terminated the employment of those individuals and will cooperate fully with law enforcement," David Galloreese, Wells Fargo's head of human resources, said in the memo. Wells Fargo's actions follow JPMorgan Chase & Co.'s finding that more than 500 employees tapped the EIDL program, and dozens did so improperly.
U.S. banks were urged by the SBA to look out for suspicious deposits from the EIDL program to their customers and even their own staff. While the program offers loans to businesses, much of the concern has focused on its advances of as much as $10,000 that don't have to be repaid. A Bloomberg Businessweek analysis of SBA data in August identified at least $1.3 billion in suspicious payments.
The bank “will continue to look into these matters,” Galloreese wrote, saying the employees' abuse didn’t involve customers. “If we identify additional wrongdoing by employees, we will take appropriate action.”