Wells Fargo scandal foreshadowed in St. Helena woman’s lawsuit

Former Wells Fargo personal banker Yesenia Guitron felt vindicated when the San Francisco bank was fined $185 million last month after scores of its employees meddled in customers’ finances without their permission.

Eight years ago, according to the Napa Valley woman, she warned supervisors that co-workers at her St. Helena branch were secretly opening and closing accounts without customers’ permission.

Within two months of being hired, Guitron said she started noticing “things that didn’t seem right” - customers were questioning why they were receiving higher service charges than they expected.

At first, she thought it was an honest mistake and the situation temporarily improved, the St. Helena woman said in an interview this week. But her perspective changed as time went on.

“I kept getting more and more people coming in: ‘How come I got this debit card? I didn’t request this debit card,’ or, ‘I got this survey saying I opened an account, but I never opened an account,’” Guitron said. “I was too busy trying to fix everybody else’s big mistakes, and that’s when I realized ... this is intentional and there was a very clear pattern.”

Once she was no longer employed by Wells Fargo, Guitron was one of the plaintiffs in a lawsuit filed in August 2010 alleging the bank had set “unreasonably aggressive and ambitious marketing goals” that encouraged employees to “artificially increase bank activity” and sell products regardless of whether customers actually needed them. The lawsuit also accused Wells Fargo of fostering an environment where employees engaged in “fraudulent and even criminal activity” and managers retaliated against workers who refused to fall in line.

A federal district court sided with Wells Fargo over Guitron in 2012, finding that the bank was justified in firing her. She also lost on appeal in 2015.

But Guitron’s allegations are receiving new attention with the bank embroiled in a national scandal over claims that bear close resemblance to some of the central charges made in her lawsuit.

A U.S. senator recently invoked her case while publicly criticizing Wells Fargo, and she has since been featured in media outlets including the New York Times, Reuters and CBS.

“It’s been overwhelming, because it’s almost like I’m reliving everything,” Guitron said this week. “I was getting so many headaches when that was happening, because everything was so tense at work and it was miserable to go to work. Now, just thinking about it and talking about it is bringing back those headaches. At the same time, it’s like, ‘I told you so. I wasn’t making this up.’?”

Government officials in September revealed the fine against Wells Fargo, whose workers may have opened as many as 2 million accounts without authorization from customers. The bank said it had already fired about 5,300 employees over the misconduct.

The Consumer Financial Protection Bureau, one of the agencies to fine Wells Fargo, said the bank’s “widespread illegal practice” of secretly opening accounts was fueled by employees trying to hit sales targets and get bonuses.

As fallout from the revelations progressed over the ensuing weeks, Wells Fargo announced the elimination of its sales targets and rescinded about $41 million in unvested equity awards for CEO John Stumpf, who struggled to defend himself and the bank amid two grueling congressional appearances. The bank also said Stumpf would forgo a bonus for this year and not take a salary while the Wells Fargo board conducts its investigation.

Sen. Jeff Merkley, D-Oregon, used details of Guitron’s case to grill Stumpf during a Sept. 20 hearing of the Senate’s banking committee.

As Merkley noted during the hearing, Guitron’s lawsuit alleged she began noticing wrongdoing at the Wells Fargo branch in St. Helena about two months after she was hired there in 2008 - years before Stumpf had said he became aware of any improper sales practices.

Guitron claimed to have received reports that another St. Helena banker was opening and closing accounts without customers’ permission. She relayed her concerns to her trainer and her manager before reporting them to the bank’s ethics hotline and higher-level management and human resources representatives, according to her suit.

Guitron’s legal filing said she was repeatedly retaliated against and terminated for insubordination in 2010.

Multiple individuals named in Guitron’s lawsuit still work for Wells Fargo. The bank declined to make any available for interviews this week.

Wells Fargo said in an emailed statement that it did not tolerate retaliation against employees who vocalized their concerns. The bank also said its top priority was repairing relationships with its customers and restoring public trust, and that it was “working at every level” to address “any issues related to improper sales practices.”

The bank pointed to a number of recent actions it took in the wake of the scandal, including expanding the scope of its review to include 2009 and 2010, hiring a multinational law firm to conduct an independent investigation, rescinding equity awards for Stumpf and a former community bank executive, eliminating product sales goals in retail banking and setting up a dedicated hotline to address customer concerns.

“We are confident that these important steps put us on the right path to better helping our customers and to ensuring that team members feel rewarded and valued based on customer service, not product goals,” spokesman Ruben Pulido said in an email. “We will continue to work hard to restore our customers’ faith and regain the public’s trust.”

But Guitron said she wanted to see more from the bank’s senior executives.

“These people need to be held accountable, because it definitely comes from the top,” Guitron said. “It’s like a pyramid: The big heads up above, they’re getting big bonuses, they get big pay, but they’re forcing sales down our throats - they keep asking for more and more and more. Although I’m not excusing what they did, I know there was a lot of bankers that did it because they need to keep a job.”

In light of the current scandal, Guitron said she may pursue additional legal action but she does not yet know what her options are. She now works in property management.

Her attorney from the Wells Fargo case, Yosef Peretz, declined to comment on what course of action may be available to Guitron, saying he could not discuss legal strategy.

He said he had mixed feelings seeing Guitron’s case brought up by Merkley in September.

“I was very pleased that at least there’s some public acknowledgment of the wrong that she suffered and of the pervasive and unlawful conduct of Wells Fargo,” Peretz said. “On the other hand, I was very disappointed that it took Wells Fargo eight years and $185 million to publicly acknowledge the widespread, unlawful practices, and it also disappointed me that, in retrospect, the federal court got it completely wrong.”

You can reach Staff Writer J.D. Morris at 707-521-5337 or jd.morris@pressdemocrat.com. On Twitter ?@thejdmorris.