Local Bank Sues Former Employees

Lawsuit alleges theft of customer information

By Robert Jordan
Dunn Daily Record

DUNN – Two former First Bank employees are accused of taking confidential information about customers and trade secrets about the business with them to their new jobs at one of First Bank’s competitors.

First Bank is suing its former Wealth Management Vice President Melissa Godwin Scott, of Lillington, and Investment Services Office Administrator Patricia “Pat” Wallace Fitzgerald, of Dunn, for unfair trade practices. In the lawsuit’s complaint, First Bank, accuses the two of emailing server-protected information to their own personal email accounts in the days leading up to their sudden departure on Sunday, Oct. 29. The two were working for the Dunn bank branch in a satellite office at 107 N. Wilson Ave., when they resigned at the same time late that afternoon.

Scott and Fitzgerald started new roles at Southern Bank, a First Bank competitor, “immediately thereafter,” according to the complaint.

Scott serves as Southern Bank’s senior vice president, senior financial adviser and southern wealth management investment executive, according to the SouthernBank.com website on Thursday. Pat Fitzgerald was listed as the company’s vice president and senior wealth associate.

The plaintiff (First Bank) claims that “in the days leading up to their Sunday resignations, Scott, or Fitzgerald at Scott’s direction and/or with Scott’s authority and consent, secretly sent confidential information of the Plaintiff to Defendant Scott’s personal email address.” The information identified in the allegation was maintained by First Bank on its server and network as well as third parties with whom First Bank contracted for services to protect the data. This was information the defendants were able to access as part of their First Bank duties, according to the complaint.

The lawsuit claims the information downloaded from First Bank’s network and sent to Scott’s personal email address included account numbers, client Social Security numbers, customer contact information, log-in credentials for First Bank portals and other confidential notes, specifically:

• “commission information on accounts of over 500 clients of First Bank;
• “a list of 782 clients, including names, addresses, emails and phone numbers;
• “information on 32 customers, including their addresses and their asset value;
• “information on 43 customers and/or potential customers referred to Wealth Management by other First Bank employees;
• “information on 1,532 accounts, including the customer name, the financial product(s) the customer held, the amount the customer had invested, and the related commissions; and
• “more client-specific data.”

First Bank alleges the emails used to misappropriate the information were deleted from Scott’s First Bank Outlook email account before her resignation.

“Scott intended for First Bank not to know what she had done in emailing the information to her personal email account,” lawyers for First Bank state in the complaint.

Fitzgerald is accused of emailing herself:

• “information on 7 clients, including their social security numbers;
• “information on 247 deceased clients, including names, addresses, social security numbers, and account numbers;
• “information on 160 First Bank clients with over $500,000 in deposits, indicating whether they are yet a First Bank Wealth Management client;
• “information on over 350 clients, including names, annuity contract numbers, annuity value, annuity type, and issue date;
• “information on 30 clients, including account numbers of investment accounts, certain maturity dates, and clients’ ages;
• “information on 188 customers, including names, ages, annuity contract types, carriers, dates of issuance, premiums, and commissions;
• “information on 502 First Bank clients and how they had been referred to First Bank; and,
• “more client-specific data.”

The lawsuit accuses Scott and Fitzgerald of actively soliciting First Bank clients “to move their accounts and their business to Southern Bank” since they became Southern Bank employees. 

“Upon information and belief, Scott and Fitzgerald have relied upon, or intend to rely upon, the data and information they misappropriated from First Bank in order to support their client solicitation efforts, which gives Scott and Fitzgerald, and by extension Southern Bank, an unfair competitive advantage,” the complaint states.

The two are accused of conversion of customer information, a breach of fiduciary duty by Scott, trade secret misappropriation, unfair and deceptive trade practices and civil conspiracy.

The Record spoke with Hillary Kestler, a public relations manager for First Bank, about the stolen data and pending lawsuit. 

“Customer security and safety are the number one priority of First Bank,” Kestler said. “I am unable to comment on a matter which is pending litigation.”

Scott responded to a request for an interview by saying, “We look forward to being able to share the entire story. I am available to any customer who may have questions regarding this matter.”

Fitzgerald declined to comment.

Contacts with Southern Bank provided no response as of press time.

First Bank is seeking a trial by jury, judgment in favor on each claim, injunctive relief, recovery of actual damages exceeding $25,000, an award of triple damages on the unfair and deceptive trade practices claim, punitive damages exceeding $25,000, an award of First Bank’s recoverable costs and such other relief as the court may deem just and appropriate.