SAN FRANCISCO–Wells Fargo has agreed to pay $1 billion to settle a class-action lawsuit that, essentially, was all about previous lawsuits and its scandals.
The lawsuit had accused Wells Fargo of overstating how much progress it had made in fixing the unlawful practices that regulators said had hurt millions of its customers, as CUToday.info has reported.
The agreement is the latest in a succession of settlements and penalties the bank has paid stemming from a fraud scandal that came to light nearly a decade ago. As CUToday.info reported here, from 2002-16, bank employees, facing unrealistic sales goals imposed by their bosses, opened millions of fake accounts in customers’ names without their knowledge.
In addition to the sham accounts, Wells Fargo has also been involved in scandals related to improper mortgage changes, accidental releases of customer data, community lending, overcharging small businesses, firing a whistleblower, and more.
‘False Impression’
“The latest settlement resolves a lawsuit brought on behalf of shareholders that focused on the bank’s conduct from 2018 to 2020, after regulators identified many of the problems,” the New York Times reported. “The plaintiffs, including pension funds in Mississippi, Rhode Island and Louisiana, said Wells Fargo, defrauded investors by giving the false impression that it was further along in the process of tackling regulators’ orders than it had disclosed at the time.”
The settlement must still be approved by a federal judge.
‘Pleased to Have Resolved This’
“This agreement resolves a consolidated securities class action lawsuit involving the company and several former executives and a director, who have not been with the company for several years,” Laurie Kight, a spokeswoman for Wells Fargo, said in a statement to the Times. “While we disagree with the allegations in this case, we are pleased to have resolved this matter.”
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