Wells Fargo Securities, Inc. Found Liable and Ordered To Pay
Paula Whitsell, a former financial consultant at Wells Fargo Securities, Inc. (“Wells Fargo”) in San Diego, California, a subsidiary of Wells Fargo & Company (NYSE: WFC – news) was awarded $1.15 million by an NASD Dispute Resolution arbitration panel. The award against Wells Fargo came after more than two years of litigation stemming from a 1997 FBI investigation of banking practices. An error made by Wells Fargo resulted in Ms. Whitsell’s arrest and prosecution by the US Attorney in San Diego. The charges were dismissed within months, however, Wells Fargo refused to publicly acknowledge their mistake causing significant financial hardship for Ms. Whitsell and her family for more than a year after the arrest. When she returned to work at Wells Fargo, the firm “managed her out” according to Philip M. Aidikoff who argued the case at hearing.
In addition to the monetary award, the arbitration panel ordered Wells Fargo to correct the information it had provided to securities regulators to truthfully and completely describe the reason Ms. Whitsell was arrested.
Ms. Whitsell was represented by Aidikoff & Uhl, a Beverly Hills and Indian Wells, California law firm that represents public customers and financial consultants in claims against brokerage firms and other financial institutions. According to Philip M. Aidikoff, “Wells Fargo should have done the right thing when they discovered that their error caused the wrongful arrest of a loyal employee. Instead, Wells Fargo decided that protecting their public image was more important than the truth.”
Mr. Aidikoff added that, “It is clear that the arbitration panel wanted to restore Ms. Whitsell’s reputation and send a message to Wells Fargo that employees must be treated responsibly.”