: Wells Fargo settles shareholder lawsuit for $1 billion: report

by | May 15, 2023 | Stock Market

Wells Fargo & Co. has agreed to pay $1 billion to settle a shareholders lawsuit related to its 2016 fake-accounts scandal, according to the Wall Street Journal. Citing court documents, the Journal reported Monday night that Wells Fargo
settled a class-action suit brought by shareholders who claimed bank executives overstated the bank’s progress at cleaning up its risk-management systems and governance in the wake of the scandal.

In a statement to the Journal, Wells Fargo said: “While we disagree with the allegations in this case, we are pleased to have resolved this matter.” The settlement, which still needs to be approved by a judge, likely would be the 17th-largest ever for a shareholders’ class action, the Journal reported. Wells Fargo has paid billions in fines and settlements related to the scandal. In December, the  Consumer Financial Protection Bureau ordered Wells Fargo to pay $3.7 billion as a result of alleged widespread mismanagement, and in March, a former Wells Fargo executive accused of overseeing the fake-account scheme pleaded guilty to criminal charges, agreeing to a 16-month prison term and a $17 million fine. Wells Fargo shares are down 6% year to date and are off 8% over the past 12 months, compared to the S&P 500’s
8% gain in 2023 and 3% rise over the past year.

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