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 massive fraud scandal that uncovered 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 has fired executives and promised regulators that it will correct the internal flaws that led to the scandal and other practices that put customers at risk.
The settlement resolves lawsuits filed on behalf of shareholders that focus on bank 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.
Wells Fargo was not immediately available for comment, but said it was working to address the issues that led to lawsuits and regulatory penalties.
Over the years, Wells Fargo has been embroiled in controversies involving fake accounts, improper mortgage modifications and false disclosure of customer data.
In December, the bank agreed to pay $3.7 billion to settle a Consumer Financial Protection Agency allegation that it was involved in a series of bank breaches. Wells Fargo has agreed to pay $3 billion in 2020 to settle a consumer abuse investigation that has dragged on for more than a decade.
The bank’s chief executive has been dismissed twice in the past seven years. John G. Stumpf in 2016 and Timothy Sloane in 2019. Chief Executive Carrie L. Tolsted pleaded guilty to criminal charges related to fake accounts in March. The scandal can carry a prison sentence of up to 16 months.
