Wells Fargo To Settle DEI Lawsuit Over Sham Job Interviews
Wells Fargo has agreed to settle a federal class-action lawsuit over allegations that it misrepresented its Diversity, Equity, and Inclusion (DEI) efforts, The Charlotte Observer reports.
The lawsuit followed reports that the bank held fake job interviews with women and people of color to satisfy internal DEI requirements, without a genuine intent to hire them.
Sham Interviews to meet diversity targets
The class-action suit stems from New York Times reports in 2022, which claimed that Wells Fargo managers were instructed to conduct “sham” interviews for roles that were already filled. These interviews were allegedly conducted solely to meet the bank’s “diverse slate” hiring policy requirements.
Introduced in 2020, the policy mandated that at least 50% of interviewees for US-based roles paying $100,000 or more must be women, people of color, veterans, LGBTQ individuals, or people with disabilities. However, whistleblowers from inside the company claimed that the process had become more performative than inclusive.
Following the reports, Wells Fargo’s stock price dropped 10.2% in two days, a loss of $17 billion of market value.
Wells Fargo’s hiring practices under fire
In September 2022, SEB Investment Management AB filed the complaint on behalf of the plaintiffs, accusing the bank of misleading investors about its commitment to DEI, artificially inflating the value of Wells Fargo stock.
The Department of Justice and the Securities and Exchange Commission (SEC) also launched investigations into the bank’s hiring practices. Both agencies closed their inquiries in 2023 without taking further action. However, in 2024, a federal judge denied Wells Fargo’s motion to dismiss the lawsuit, citing additional evidence from whistleblowers and former employees.
The settlement, reached in principle on September 15, is expected to be submitted for court approval by October 13 in the US District Court for the Northern District of California. A hearing is scheduled for November 2025.
Wells Fargo continues to deny any wrongdoing. “We believe the claims were without merit,” the bank said in a statement to The Charlotte Observer. “Wells Fargo does not tolerate discrimination in any part of our business.”
A History of DEI Controversies
This is not the first time Wells Fargo has faced scrutiny over its diversity practices. In 2013, the company settled a $35.5 million racial discrimination lawsuit. In 2020, it agreed to pay $8 million after the Department of Labor found the bank had discriminated against Black job applicants.
CEO Charles Scharf also faced backlash in 2020 for stating that the “Black talent pool is limited,” a remark he later apologized for.
In February, amid growing political attacks on DEI, the bank announced it would no longer require hiring managers to consider a diverse slate of candidates for upper-level roles. In September, HR Brew reported that Wells Fargo had quietly removed most diversity-related language from its public communications.
Internally, DEI efforts are still being led by Ebony Thomas, Head of DEI. The bank also maintains targeted programs for veterans, employees with disabilities, and neurodivergent workers, and its website still states it is committed to building an inclusive workforce.
However, public criticism continues. Protesters recently gathered outside Wells Fargo offices in San Francisco and New York, calling attention to the bank’s DEI policy rollbacks, ties to the fossil fuel industry, and support for Israel’s military, Bloomberg reports. Several demonstrators were arrested at the San Francisco headquarters.
Image credit: Wells Fargo
