Wells Fargo Settles Shareholder Suit Over Fake Accounts for $480 Million

May 23, 2018 by

The most recent cost to Wells Fargo & Co. arising out of its fake-account scandal is a $480 settlement with its shareholders. The settlement resolves the main class-action suit brought by shareholders targeting the bank’s allegedly deficient disclosures related to its sales practices.

This is the latest cost for Wells Fargo from a consumer banking scandal that arose in September 2016. That issue, in which employees opened as many as 3.5 million bogus accounts, ultimately cost then-CEO John Stumpf his job. The bank still faces a bevy of other lawsuits on related matters.

Last month, the San Francisco-based bank settled with the Office of the Comptroller of the Currency and the Consumer Financial Protection Bureau for an unprecedented $1 billion to cover issues in auto lending and mortgages. In February, the Federal Reserve imposed a sanction prohibiting the bank from boosting total assets beyond their level at the end of 2017 until it fixes shortcomings.

The shareholder case is Hefler v. Wells Fargo & Co., 3:16-cv-05479, U.S. District Court, Northern District of California (San Francisco).

Steve Larson
An experienced trial lawyer who handles both hourly and contingent fee cases, Steve has expertise in class actions, consumer cases, antitrust litigation, securities litigation, corporate disputes, intellectual property disputes, unfair competition claims, employment matters, and disputes involving family wealth. Steve regularly represents individuals and businesses in federal and state court and has obtained class-wide recovery in multiple class actions. A veteran practitioner, Steve's clients value his creative approach to resolving complex litigation matters.

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