In 2016 former Prudential employees filed a whistle-blower lawsuit asserting that the company had tried to hush up evidence that Wells Fargo bankers — who were supposed to market a low-cost Prudential policy, MyTerm, to their customers — opened sham accounts in customers’ names and had premiums withdrawn from their accounts without their consent or knowledge. Many of the victims did not speak English, the suit said.
There was also a suspicious pattern of MyTerm policies being closed and reopened, suggesting the unseen hand of a banker trying to buoy sales numbers. For example, “18 clients who purchased the MyTerm policies allowed them to lapse, or they were canceled and then repurchased them two more times,” the lawsuit states.
“We were like insurance salespeople without the license,” said Michael Barborek, a former Wells Fargo banker in Orange, Tex. “They wanted us to offer it to everybody who came in.”
Prudential suspended sales of its life insurance policies through Wells Fargo shortly after the suit became public.