Wells Fargo Pays $1 Billion to Settle Class-Action Lawsuit
From the desk of Jim Eccleston at Eccleston Law
Wells Fargo has agreed to pay $1 billion to settle a shareholder lawsuit that accused the company of making misleading statements related to its compliance with federal consent orders following the unauthorized customer account scandal in 2016.
The settlement qualifies as one of the top six largest securities class-action settlements within the past decade. The investors initially filed suit against Wells Fargo in 2020 alleging that its former chief executive officer, Tim Sloan, and other executives made misleading statements while testifying in front of Congress. The investors further alleged that the executives painted “too rosy” of a picture regarding their dealings with regulators, such as failing to disclose that their initial reform plans had been rejected.
The proceeds of the class-action suit will be paid to investors who purchased Wells Fargo stock between February 2, 2018, and March 12, 2020. Wells Fargo previously agreed to pay $3 billion in 2020 to avoid criminal charges and settle with federal prosecutors, who were investigating more than a decade of widespread consumer abuses.
Eccleston Law LLC represents financial advisors and investors nationwide in securities, employment, transition, regulatory and disciplinary matters.
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