Federal Judge Rules Lawsuit Necessary for Wells Fargo Execs Over Fake Accounts

A federal judge ruled that a shareholder lawsuit will be necessary against Wells Fargo CEO Tim Sloan and other executives of the company in connection with a fake account opening scandal.

Judge Jon S. Tigar ruled that a complaint brought against Wells Fargo executives in connection with a fake account opening scandal adequately alleged that such executives “made false and misleading statements,” meaning a lawsuit will be required.

Tigar wrote that it was “implausible” that the defendants in the case, including CEO Tim Sloan, “were unaware of the account-creation scheme” and that the aggressive cross-selling strategy emphasized by the company contributed to the fraudulent practices.

Tigar specifically called out Sloan, saying “even if somehow Mr. Sloan had no knowledge of the practices before 2013… he certainly was aware of these issues as of December 2013.” Judge also said the complaint adequately alleged that Sloan and other executives “breached their fiduciary duties.”

Like this story? Begin each business day with news you need to know! Register now for FREE Daily E-News Broadcast and start YOUR day informed!

Leave a comment

View Latest Digital Edition

Terry Mulreany
Subscriptions: 800 708 9373 x130
Susie Angelucci
Advertising: 484.459.3016

View Latest Digital Edition

Visit our sister website for news, information, exclusive articles,
deal tables and more on the asset-based lending, factoring,
and restructuring industries.