Wells Fargo fires up to 125 employees over misuse of EIDL aid
Summary
Wells Fargo fired between 100 and 125 employees who made false representations when applying for coronavirus aid through the Economic Injury Disaster Loan program, according to this brief by Dan Ennis published Oct. 15, 2020, citing press reports. In an internal memo the bank said employees created fake profiles to apply, and its head of human resources, David Galloreese, wrote that their employment had been terminated and the bank would cooperate fully with law enforcement. The brief notes that a month earlier JPMorgan Chase found more than 500 of its employees had accessed EIDL funds, dozens of whom should not have. It also cites a Bloomberg analysis finding $1.3 billion in suspicious EIDL payments and an SBA inspector general count of more than $250 million paid to potentially ineligible recipients and $45.6 million in possibly duplicate payments.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Full text
Brief Wells Fargo fires up to 125 employees over misuse of EIDL aid Flickr user MoneyBlogNewz Author By Dan Ennis @Ennis77Dan Published Oct. 15, 2020 Share it Dive Brief: - Wells Fargo has fired between 100 and 125 employees who made false representations when applying for coronavirus aid through the Economic Injury Disaster Loan (EIDL) program, Bloomberg , The Wall Street Journal and Reuters reported Wednesday, citing an anonymous source. - In a memo seen Wednesday by The New York Times , Wells Fargo said employees created fake profiles to file for money available through the program. - The firings come a month after fellow banking titan JPMorgan Chase launched an internal investigation that found more than 500 of its employees accessed EIDL funds, though dozens shouldn't have. The bank fired several of its workers — but gave no concrete number — and sent a company-wide memo warning that it has "seen conduct that does not live up to our business and ethical principles — and may even be illegal." Dive Insight: The Small Business Administration (SBA) has provided emergency help to small businesses for years. In 2020, the federal government expanded the program as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act to cover pandemic-related emergencies. The SBA's inspector general in late July called for closer oversight of the EIDL program over fraud concerns, warning banks to investigate suspicious deposits from the program to its customers and staff. Unlike the Paycheck Protection Program (PPP), EIDL payments come directly from the SBA rather than through banks that serve as middlemen. Businesses can apply for loans through EIDL, but the program also offers grants of up to $10,000 that don't need to be repaid. It's that aspect of EIDL that's reportedly generating much of the SBA's — and banks' — concern. A Bloomberg analysis in August found $1.3 billion in suspicious payments tied to the EIDL program because the number of grants in 52 congressional districts exceeded the number of eligible small businesses. Meanwhile, the SBA's inspector general identified more than $250 million in aid given to potentially ineligible recipients, in addition to $45.6 million in possibly duplicate payments. Nine financial institutions reported almost $200 million in suspicious transactions, according to The Wall Street Journal, which cited the inspector general's report. Wells Fargo has "zero tolerance for fraudulent behavior," the bank said in Wednesday's internal memo. "We have terminated the employment of those individuals and will cooperate fully with law enforcement," David Galloreese, the bank's head of human resources, wrote in the memo. "These wrongful actions were personal actions, and do not involve our customers." Wells Fargo "will continue to look into these matters," Galloreese added. "If we identify additional wrongdoing by employees, we will take appropriate action." Upon taking the top role at Wells Fargo, CEO Charlie Scharf said the bank would tackle potentially thorny regulatory matters "with a different sense of urgency ." Follow Dan Ennis on Twitter Filed Under: Commercial Retail
File and source
- File
- bankingdive-587080-wells-fargo-fires-employees-eidl-wb20201015190311.html
- Size
- 149,844 bytes
- SHA-256
- e9f078ff2986a23fbefbf9927042d74530f07700c9858832b34bcaf56ae3e386
- Original
- web.archive.org