Daily News: October 6, 2017

Federal Judge Okays Lawsuit Over Wells Fargo 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.”