Wells Fargo settles with former Bluffton branch employees

05/07/2014 8:32 PM

05/07/2014 8:38 PM

Wells Fargo has reached settlements with former Bluffton branch employees, whose lawsuit alleges they were fired to cover up a bank executive’s cocaine use and sexual harassment.

The bank says they were fired for violating company ethics rules.

Meanwhile, a branch employee fired the same month as the others has sued the bank, alleging she was wrongfully terminated after a company investigator told her she could keep her job in return for turning in her co-workers.

The San Francisco-based lender settled a lawsuit last week with former branch manager Mark Stroud, who sued the bank and bank investigator Chuck Owens for wrongful termination and civil conspiracy, according to federal court records. The settlement amount was not disclosed.

In April, a lawsuit filed by seven former tellers was settled and removed from the Beaufort County Court of Common Pleas roster, according to the Beaufort County Clerk of Court office. The tellers sued the bank and Owens for wrongful termination. A trial had been scheduled to begin next week, according to the clerk’s office.

Hilton Head Island attorney John Bowen, who represented the former employees in both cases, said Wednesday in a written statement, “The parties have agreed to dismiss the case ... and have agreed to make no further comment on these matters.”

Charleston attorney Jennifer K. Dunlap, who represents the bank, also declined comment.

Attempts Wednesday to reach a spokesman for Wells Fargo were unsuccessful.

Stroud and the tellers were fired in July 2012 after district manager Scott Zardenetta said they violated company ethics rules when they received credits for opening accounts they had not earned, according to the company’s response to the lawsuit.

The employees’ suit says they were fired after Stroud blew the whistle on Zardenetta’s alleged cocaine use and sexual harassment. They allege Zardenetta and Owens concocted an excuse to fire them after that conduct was reported to the bank’s human resources officials.

The bank has denied the allegations and said it did nothing illegal by firing the employees. It also asserts Stroud was fired for “documented performance and customer-service failures.”

Zardenetta, who went on medical leave around the time the lawsuits were filed, sued the bank separately in June over its short-term disability policy. He settled with Wells Fargo for an undisclosed amount in November, according to federal court records.

He was dismissed as a defendant in the former employees’ cases in December, records show.

Attempts Wednesday to reach Zardenetta were unsuccessful. An employee at the bank’s Sea Pines branch said they do not believe Zardenetta still works for the company.


Trouble at the branch at 11 Arley Way began in April 2012 during the RBC Heritage Presented by Boeing golf tournament, according to the suit.

Branch employee Wendy Baxley showed Stroud, the branch manager, and other employees a text message from Zardenetta that was forwarded to her. In the message, Zardenetta suggested that he and Baxley’s boyfriend — a Wells Fargo employee in the bank’s Sea Pines branch — have sex with her.

Zardenetta “was in a hotel room in Hilton Head, had been using drugs, was in possession of an ‘eight ball’ of cocaine and ... was proposing that he and (Baxley’s boyfriend) both have intercourse with her,” the suit states.

Zardenetta also suggested that Baxley’s boyfriend bring another female employee from the Sea Pines branch to the hotel for sex, according to the suit.

Baxley remains with Wells Fargo at the bank’s Okatie branch. She declined comment Wednesday.

Stroud reported what he had been told to Wells Fargo’s human resources department with the understanding that it “would remain confidential and that his identity would not be disclosed to” Zardenetta, the suit says.

But soon afterward, Zardenetta “began writing negative personnel memoranda about Stroud, stopped coming to the Bluffton branch and refused to acknowledge the successes of any of the staff.”

The employees were told in July 2012 they were being fired because of the way they received credits for new accounts they helped set up a month earlier. The accounts were for 31 Chinese exchange students who lived in Bluffton. According to the suit, two tellers met with the students at their apartment complex and collected necessary forms and signatures. Those tellers returned to the bank and shared the students’ information with other tellers, who helped complete the process for creating the accounts.

Employees are awarded credits toward their monthly quotas for bringing in new accounts. The bank’s policy ordinarily requires tellers to meet in person with customers to earn credits, but because of the number of Chinese interns, the situation “was not typical,” according to the suit. The tellers were assured by Stroud that they could share the credits, the suit states.

The bank, however, considered it unethical for the tellers, who didn’t meet in person with the interns, to get credits, according to the suit. Within days, they were interrogated, one by one, by Zardenetta and bank investigator Owens, the suit says. During the interviews, the employees were allegedly coerced into signing self-incriminating statements.


One of the employees interviewed by Owens was Amber Swisher, who filed a lawsuit in March. In it, she alleges that she reported what employees had done with the new accounts.

Swisher was told in a closed-door meeting with Owens that she could keep her job for telling the truth, the suit says.

Swisher, however, was fired with the others in July 2012.

“Wells (Fargo) and Owens had already predetermined that they were going to terminate Amber and many others ... regardless of what Amber stated to them during the course of their investigation,” the suit alleges.

Swisher alleges wrongful termination, among other accusations, and seeks actual and punitive damages.

Her attorney, Patrick Carr of Hilton Head, declined comment Wednesday. Attempts to reach Swisher were unsuccessful.

Wells Fargo has not responded to Swisher’s complaint, according to Beaufort County court records. The case is pending.

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