Wells Fargo is set to settle a class-action lawsuit accusing the bank of overstating how much progress it has made in rectifying a misconduct that regulators say has hurt millions of customers. agreed to pay $1 billion.
The agreement, detailed in a court filing on Monday, is the latest in a series of settlements and fines paid by the bank in the wake of a fraud scandal that unfolded nearly a decade ago. Between 2002 and 2016, bankers faced with unrealistic sales targets imposed by their bosses opened millions of accounts in their customers’ names without their knowledge.
Wells Fargo fires executives promised to regulators It claimed it would fix internal flaws that caused scandals and other actions that endangered customers.
The settlement resolves lawsuits brought on behalf of shareholders that focused on the bank’s conduct from 2018 to 2020 after regulators identified a number of issues. Plaintiffs, including pension funds in Mississippi, Rhode Island and Louisiana, falsely gave the impression that Wells Fargo was more committed to the regulatory orders than it had made clear at the time, and invested Claimed to have defrauded the house. It was previously reported that the settlement would require the approval of a federal judge in New York. wall street journal.
“This agreement resolves a consolidated securities class action lawsuit involving the company, several former executives and a director who have not been with the company for several years,” Wells Fargo spokeswoman Rory Kite said in a statement. is something,” he said. “While we do not agree with the allegations in this case, we are pleased that this issue has been resolved.”
Over the years, Wells Fargo has been the subject of controversy. fake account, Improper Mortgage Modification and Accidental disclosure of customer data.
In December the bank agreed to pay $3.7 billion To settle allegations that the Consumer Financial Protection Bureau was involved in a series of bank breaches.Wells Fargo agreed to pay $3 billion A consumer abuse investigation that has lasted more than a decade will be resolved in 2020.
Twice in the last seven years, the bank’s CEO has resigned. John G. Stumpf 2016 and Timothy Sloane CEO in 2019, Carrie L. Tolstedpleaded guilty in March to criminal charges related to the fake account scandal, which could carry a maximum sentence of 16 months in prison.
“If this settlement is approved, we would like to thank the hundreds of thousands of investors (including state employees, nurses, teachers, police and firefighters) whose critical retirement savings have been affected by Wells Fargo’s fraudulent practices. ,” said managing partner Steven J. Toll. Cohen Milstein Sellers & Toll, which represented the investors in the lawsuit, said in a statement:
