According to an internal memo reviewed on Wednesday evening, the company said it identified workers who are believed to have defrauded the Small Business Administration by making "false representations in applying for coronavirus relief funds for themselves.”
The review focused on employees who, outside of their work responsibilities, allegedly tapped funds tied to the Economic Injury Disaster Loan program, which are earmarked to aid small businesses hurt by coronavirus-induced shutdowns.
“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. "We have zero tolerance for fraudulent behavior and will continue to look into these matters. If we identify additional wrongdoing by employees, we will take appropriate action."
Galloreese added that the alleged abuse is "not representative of the high integrity of the vast majority of Wells Fargo employees."
Wells Fargo’s action follows a similar investigation launched by JPMorgan Chase last month.
In addition, a group of small business owners filed lawsuits against some of the nation's biggest banks in mid-April, including Wells Fargo and JPMorgan, accusing them of reshuffling applications to frontload businesses seeking higher loans, thereby boosting their own profits.
|WFC||WELLS FARGO & CO.||47.00||+0.57||+1.23%|
|JPM||JPMORGAN CHASE & CO.||164.12||+2.61||+1.62%|
Wells Fargo stock closed at $23.25 per share at the end of Wednesday's trading session, down roughly 6 percent.