Wells Fargo faces two more lawsuits over bank accounts scandal
Wells Fargo is facing fresh legal action from both employees and investors over the ongoing bank account scandal.
The US retail bank, which agreed to pay a $185m fine for creating two million unauthorised bank accounts, is now looking at class action lawsuits from employees who were let go over the claims and investors who have suffered a paper loss of around 12 per cent since the start of the month.
Employees, who are alleging the bank violated financial and employment laws over its failure to pay staff overtime so they could meet their aggressive sales quotas, are seeking damages of at least $7.2bn. The US Labour Department also said it is preparing to launch a "top-to-bottom" review of working practices at the firm in response to the developments.
Meanwhile, a lawsuit claiming chief executive John Stumpf was among those who sold $31m of shares in the company at "artificially inflated" prices has been filed on behalf of investors. Last week Stumpf faced a US Senate hearing and also stepped down from his position as an adviser to the San Francisco Federal Reserve over the scandal.