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SEC charges ex-Wells Fargo CEO, top exec for role in misleading investors

The agency claimed that the former executives misled investors about the widespread sales practice problems at the bank

Topics
Wells Fargo | Investors

Reuters  |  WASHINGTON 

US SEC

By Pete Schroeder

WASHINGTON (Reuters) - The Securities and Exchange Commission charged former CEO John Stumpf and retail banking head Carrie Tolstedt with misleading investors, the watchdog announced Friday.

The agency claimed that the former executives misled about the widespread sales practice problems at the bank. Stumpf agreed to pay a $2.5 million penalty to settle the charges, while the SEC will litigate fraud charges against Tolstedt in court.

Lawyers for Stumpf and Tolstedt did not immediately respond to a request for comment.

The new charges mark the latest in a long-running set of legal and regulatory woes for the bank and its former leadership, after the firm was embroiled in a massive scandal over the creation of fake accounts by employees. In February, the bank agreed to pay $3 billion to settle a joint probe by the SEC and Justice Department.

And Stumpf and Tolstedt have faced individual sanctions as well. Stumpf was barred from the banking industry and fined $17.5 million by a banking regulator in January, and Tolstedt is facing a $25 million fine which she is fighting in court.

In the latest charges, the SEC said the pair misled about the health of their sales practices, and they should have known about deep-seated issues within the bank.

 

(Reporting by Pete Schroeder; Editing by Toby Chopra)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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First Published: Fri, November 13 2020. 21:25 IST
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