The story of Wells Fargo’s legal and ethical troubles began in earnest in 2016. It was then that the bank was found to have created millions of unauthorized customer accounts and imposed auto insurance on hundreds of thousands of unsuspecting clients. This shocking revelation brought a wave of scrutiny upon one of America’s most well-known banking institutions.
Following this discovery, the Federal Reserve took action in 2018, issuing several orders that required Wells Fargo to make significant improvements to its client practices and governance. For years, the bank has been operating under consent orders. Wells Fargo reported to investors that they had made significant improvements over the past situation and assured them that there were no compliance issues.
However, this semblance of progress was shattered in March 2020. Governmental reports revealed the alarming fact that Wells Fargo was still unable to stop harming its customers and comply with the orders issued earlier. These revelations were a profound blow to the bank’s reputation and investor confidence. The stock value plunged dramatically from $47 to $30, causing investors to lose billions in a very short span of time.
And just recently, Wells Fargo made the decision to pay its shareholders $1 billion in compensation while staunchly denying all the allegations that had been made against them. Of this sum, attorneys will take up to 19%, with the remaining funds going directly to the shareholders. This move can be seen as an attempt to regain trust and stabilize the bank’s relationship with its investors.
Any investor who has traded $WFC could be eligible for part of that compensation. You can claim your part of the settlement here
