A New York federal judge on Friday approved a $1 billion settlement agreement between Wells Fargo & Co. and its shareholders, resolving a class-action lawsuit that had accused the bank of misleading investors about its progress in cleaning up sham accounts.
U.S. District Judge Jennifer L. Rochon authorized the settlement more than three months after it was reached on May 8, 2023. The amount brings the bank’s total payment related to the scandal to almost $5 billion.
The agreement stemmed from a lawsuit filed in 2020 by a class of shareholders led by pension and employee retirement plans in Louisiana and Rhode Island. They accused former Wells Fargo CEO Tim Sloan and several other executives of lying to investors and the public about the bank’s progress in cleaning up fake accounts.
Between 2002 and 2016, Wells Fargo employees opened millions of accounts under clients’ names without their knowledge in order to meet what they referred to as “unrealistic sales goals.”
The latest settlement focuses on the bank’s actions from 2018 to 2020. Under the settlement, eligible to receive payments are individuals who purchased Wells Fargo stock between February 2, 2018, and March 12, 2020.