Bank of America Ordered to Pay Wistleblower $930k
Bank of America Ordered to Pay Wistleblower
$930k
Bank of America has been ordered to pay one of its former employees $930,000 for alleged violations of federal whistleblower protection laws. The US Labor Department has also ordered the bank to reinstate the worker, a former Countrywide employee who was fired shortly after BoA acquired the mortgage firm in 2008. According to a statement released by Labor, the worker led internal investigations that led to the discovery of widespread and pervasive fraud at Countrywide. The amount of the payment is intended to cover back wages, interest, compensatory damages and legal costs.
“It's clear from our investigation that Bank of America used illegal retaliatory tactics against this employee,” said David Michaels from the Labor Department. “This employee showed great courage reporting potential fraud and standing up for the rights of other employees to do the same.” The employee claimed that anybody who attempted to report incidents of fraud to Countrywide's Employee Relations Department was harassed.
Bank of America said it plans on challenging the order, saying it released the worker due to issues related to management style rather than because he filed the complaints. The bank claims it takes fraud allegations very seriously and the employees claims were investigated thoroughly and appropriate action was taken.
The acquisition of Countrywide has led to one major headache after another for Bank of America, forcing the nation's largest bank by assets to deal with heavy financial losses, regulatory investigations, and numerous hefty lawsuits. The bank's stock has fallen some 48 percent this year, mostly due to mortgage issues created by Countrywide practices before the acquisition. In just the first six months of 2011, BoA paid out more than $12.5 billion to settle claims that Countrywide sold investors faul;ty securities loaded with bad mortgages.
Bank of America has been ordered to pay one of its former employees $930,000 for alleged violations of federal whistleblower protection laws. The US Labor Department has also ordered the bank to reinstate the worker, a former Countrywide employee who was fired shortly after BoA acquired the mortgage firm in 2008. According to a statement released by Labor, the worker led internal investigations that led to the discovery of widespread and pervasive fraud at Countrywide. The amount of the payment is intended to cover back wages, interest, compensatory damages and legal costs.
“It's clear from our investigation that Bank of America used illegal retaliatory tactics against this employee,” said David Michaels from the Labor Department. “This employee showed great courage reporting potential fraud and standing up for the rights of other employees to do the same.” The employee claimed that anybody who attempted to report incidents of fraud to Countrywide's Employee Relations Department was harassed.
Bank of America said it plans on challenging the order, saying it released the worker due to issues related to management style rather than because he filed the complaints. The bank claims it takes fraud allegations very seriously and the employees claims were investigated thoroughly and appropriate action was taken.
The acquisition of Countrywide has led to one major headache after another for Bank of America, forcing the nation's largest bank by assets to deal with heavy financial losses, regulatory investigations, and numerous hefty lawsuits. The bank's stock has fallen some 48 percent this year, mostly due to mortgage issues created by Countrywide practices before the acquisition. In just the first six months of 2011, BoA paid out more than $12.5 billion to settle claims that Countrywide sold investors faul;ty securities loaded with bad mortgages.
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