Wells Fargo has agreed to pay $480m to resolve a class action lawsuit brought by shareholders over alleged securities fraud.
The lawsuit alleged that the bank misstated or omitted certain details regarding its sales practices.
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The bank refuted the charges saying that it signed the agreement in principle in order to “avoid the cost and disruption of further litigation”.
The lawsuit was filed in US federal court in the Northern District of California. The bank said that the agreement to resolve the lawsuit is in principle and is subject to approval by the court.
Wells Fargo CEO Tim Sloan said: “We are pleased to reach this agreement in principle and believe that moving to put this case behind us is in the best interest of our team members, customers, investors and other stakeholders. We are making strong progress in our work to rebuild trust, and this represents another step forward.”
Wells Fargo came under the scanner for the illegal sales practice of secretly opening unauthorised deposit and credit card accounts and was consequently fined $185m by federal and state regulators.
