Wells Fargo, AMD, Fifth Third May Have Run Afoul Of Whistleblower Laws

Wells Fargo, Advanced Micro Devices (AMD) and Fifth Third Bank have reportedly struck settlement agreements with former employees that may have run afoul of U.S. whistleblower protection laws.

According to a report by Reuters, which cited five lawyers, including three who represent whistleblowers, the settlements appear to be aimed at preventing employees from voicing concerns about their company’s activities regarding government rules. The deals with the three companies were among a dozen corporate settlements reviewed by Reuters between 2012 and 2015. The deals limit their ability to get money that arises from any government investigations into their former employers. Some of the language in the settlements could be in violation of rules adopted by the Securities and Exchange Commission in 2011 that bars companies from trying to silence whistleblowers.

According to the report, a Wells Fargo spokeswoman declined to comment, as did a spokesman for AMD. A spokesman for Fifth Third said the agreement “speaks for itself,” and the company “takes seriously” its obligation to comply with all “relevant laws.” A SEC spokeswoman declined to comment.

The rules put in place by the SEC protect whistleblowers from any retaliation by the company and prevent companies from taking action that could “impede an individual from communicating directly” with the SEC. That includes via confidentiality agreements. The SEC program has already awarded more than $85 million to 32 whistleblowers. Earlier this month, the SEC announced civil charges lodged against two companies that require leaving employees to waive their rights to recover government whistleblower awards in severance agreements.

Those companies, Health Net (now part of Centene) and BlueLinx Holdings settled without admitting or denying liability, and each paid six-figure fines, noted the report. Jordan Thomas, a lawyer at Labaton Sucharow, which represents whistleblowers, told Reuters the language used in the Fifth Third, Wells Fargo and AMD settlements is designed to prevent whistleblowers from reporting corporate misbehavior. “I believe the SEC would be troubled by this,” Thomas said.


New PYMNTS Report: The CFO’s Guide To Digitizing B2B Payments – August 2020 

The CFO’s Guide To Digitizing B2B Payments, a PYMNTS and Comdata collaboration, examines how companies are updating their AP approaches to protect their cash flows, support their vendors and enable their financial departments to operate remotely.

Click to comment