Wells Fargo Ex-Managers’ Suit Puts Scandal Blame Higher Up Chain

  • Area president may be highest-ranking alleged to direct scheme
  • Ex-branch managers claim workers taught to cheat, threatened

Wells Fargo Account Scandal: Who Knew What, When?

The lawsuits piling up against Wells Fargo & Co. over its fake accounts scandal have expanded to include three former branch managers alleging that an area president ordered employees to open bogus accounts to juice sales.

The area president, who may be the highest-ranking bank employee alleged to have directed the opening of fraudulent accounts, told employees to “do whatever it takes” to meet sales quotas and keep their jobs, according to the lawsuit.

Lefky Mansi, a longtime area president in the Los Angeles region, and Shabnam Ebrahimi, a district manager, threatened employees’ careers after they complained to federal agencies and human resources about explicit instructions from the defendants to defraud account holders, the former branch managers said in the complaint filed Tuesday in Los Angeles Superior Court.

Wells Fargo is continuing its effort to “address behaviors inconsistent with our vision and values," Bridgette Braxton, a spokeswoman for the bank, said Thursday in an e-mailed statement. “We strive to foster a supportive and engaging work environment for team members and to create deep and enduring relationships with our customers by discovering their needs and delivering the most relevant products, services and guidance.”

Braxton declined to comment on the lawsuit. Mansi, once one of about 120 area presidents four rungs below the head of community banking, is no longer with Wells Fargo, Braxton said. Ebrahimi, who reported to Mansi, is still a district manager, she said. Mansi and Ebrahimi couldn’t be reached for comment on the lawsuit.

The claims against Mansi show litigants are looking higher up the chain of command than the almost 500 low-level managers terminated for allegedly improper sales tactics over the past five years. The highest of that bunch was an area president, then-Chief Executive Officer John Stumpf told a U.S. Senate panel in September. The lawsuit is among dozens filed in state and federal courts across the country by employees, consumers and shareholders since the company agreed Sept. 8 to pay $185 million to resolve government probes.

Stumpf, Tolstedt

Since then, the bank’s board has embarked on its own internal investigation into how the company’s strategy to persuade each customer to sign up for more Wells Fargo products turned to fraud as early as 2009. In the meantime, Stumpf and Carrie Tolstedt, who oversaw the consumer unit from 2006, resigned this year while giving up a combined $60 million in unvested stock.

The ex-branch managers’ allegations are among the most egregious individual claims in the swell of litigation against the bank. Among other claims, Mansi directed subordinates to teach “weak” employees who declined to use “illegal techniques” of the “Wells Fargo way," according to the lawsuit. Their bosses told employees to “make up a business need” to gain unauthorized access to customer accounts, the plaintiffs said.

Yasmeen Fasheh, one of the the plaintiffs, said she took her complaints over illegal “cross-selling” to the U.S. Office of the Comptroller of the Currency in August 2013. She said that when she told Mansi she had complained, he responded, “You’re just a little ant in the company. If I’m going down, you’re going down, as well."

Fasheh and the other branch managers either resigned or were terminated from March 2013 to November 2014, according to the complaint.

“I suspect that once we begin the discovery process, we will find that the conduct goes well beyond the regional level and that it is possible we may end up bringing in additional defendants,” James Urbanic, the plaintiffs’ lawyer, said in a phone interview. “It’s possible that will include regional managers and bank executives.”

The case is Fasheh v. Wells Fargo Bank, BC642810, California Superior Court, Los Angeles County (Los Angeles).

— With assistance by Laura J Keller

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