New scandal involving Prudential and Wells Fargo
Prudential Financial Inc. is now involved in a serious scandal as it has been accused of a fraudulent cover up of life policies to low income customers through Wells Fargo and Co. This scandal has led to the departure of Wells Fargo’s CEO, John Stumpf, and the company is struggling to get past the crisis. Three employees from from the corporate investigations division at the giant lender Prudential are now alleging that executives ignored their reports of fake accounts in order to avoid alienating Wells Fargo as a business partner.
They reported that 7 out of ten MyTerm policies sold during 2014, lapsed. These policies were sold to clients with predominantly Hispanic names, and sales spiked towards the end of the year. They also claim that, after reporting their findings to top level executives, they were escorted from the building, placed on administrative leave and are now under an imminent termination threat.
This information comes from the lawsuit that has been opened in New Jersey state court, as reported this past Friday by the New York Times.
In the case: The case is Broderick v. The Prudential Insurance Co. of America, Superior Court of New Jersey Law Division — Essex County, the mentioned employees are invoking New Jersey’s Conscientious Employee Protection Act, and they are now seeking lost wages and other compensation, on top of punitive damages.
Wells Fargo representatives, however, have a different opinion, as expressed by their spokesperson Scot Hoffman: “These former employees were terminated for appropriate and legitimate reasons that were entirely unrelated to Prudential’s business with Wells Fargo and Prudential’s decision to examine sales of the MyTerm product. Beyond that, Prudential does not comment on employment matters. We are confident that the court will agree once the true facts are revealed during the litigation.” The statement was made as a press release delivered by email, and no further statements have been made since.