Skip to content

Carrier Management

Critical Information for P/C Carrier Executives

Highlights

  • P/C Industry Loss Reserves Redundant by More Than $20B: ...
  • How Modern is Modern Enough?
  • Liberty Mutual Done with Fixing, On to Building
  • Carrier Management
  • C-Suite
  • News
  • Research
  • Leadership
  • Markets
  • Regulation
  • Top 50
  • Members Only
  • Join
  • Login
  • Boardroom Agenda
  • CEO / Chief Executive
  • CFO / Financial
  • Underwriting
  • CTO / Technology
  • Risk
  • Brand Management & Sales
  • Investment Officers
  • Claims / Legal
  • Talent Management
Meet the New AI Coworker Who Won’t Stop Snitching to Your Boss
What Men and Women Think About Gender and Pay: AP-NORC poll
  • U.S.
  • International
  • Industry News
  • Government
  • Technology & Science
Vehicle Customization, Strong Used Car Market Create Headache for Auto Underwriters
U.S. Forecaster Expects ENSO‑Neutral to Continue, While El Nino Risk Builds

See all News

  • Executive Spotlight
  • Innovation
  • Strategy
  • Leadership
  • Performance
  • Growth Initiatives
  • Social Responsibility
From Volatility to Value: How Carriers Can Build Durable Growth
Four Moves That Will Keep Midsize Mutuals Competitive
  • Reinsurance
  • Emerging Markets
  • Global Economy
  • Personal Lines
  • Commercial Lines
  • Specialty
U.S. E&S Growth Slows Again; Declining Berkshire Volume Tops Leaders
U.S., Iran Agree to Two-Week Ceasefire Brokered by Pakistan
  • Insurance Regulation
  • Securities Regulation
  • Accounting & Tax
  • Rating Agencies
NAIC Issues Nationwide Data Call to Homeowners Insurers
Verisk, APCIA See ‘Reset’ Rather Than New Normal in Stellar ’25 Results
‘Too Much Space,’ Says State Farm CEO on Shuttering Corporate HQ
P/C Industry Loss Reserves Redundant by More Than $20B: Assured Research
The List Is Growing: More Insurance Apps on ChatGPT
Is Commercial Auto Having It’s ‘Sprinkler Moment’?

See all Top 50

How Insurance Leaders Can Leverage AI Without Sacrificing Trust
How Insurance Can Turn Maintenance Into Measurable Competitive Advantage
The Enemy Within: Insider Threats Are Hard to Detect, Harder to Predict
Investor Chicken Little and the AI Sales Channel: OpenAI Insurance Apps Trigger Uncertainty

See all Members Only Content

Benefits

  • News for the P/C Insurance C-Suite - Focused reporting from reliable sources and experienced financial journalists.
  • Research and Analysis Not Found Elsewhere - Exclusive content from researchers think tanks, industry experts and respected analysts.
  • High-Profile Peers - Interviews with thought leaders in the global and U.S. insurance industry.

Online Access

Complete, unrestricted access to the popular CarrierManagement.com website, which provides insurance company C-suite executives with daily news, white papers, advice, instruction and editorial on how to manage insurance companies more efficiently and more effectively.

Wells Fargo, Ex-CEO Fail to Squash Shareholder Lawsuit Over Fake Accounts

Print Email
March 1, 2018 by Kartikay Mehrotra

A federal judge denied Wells Fargo & Co.’s request to dismiss a shareholder lawsuit triggered by the bank’s plummeting stock price after it admitted in 2016 to creating millions of fake accounts, starting the worst financial scandal in its modern history.

U.S. District Judge Jon Tigar in San Francisco ruled Tuesday that shareholders can proceed with most claims in a suit alleging the company and its current and former leaders misled shareholders about its opening of unauthorized accounts. Investors blame the company for the stock’s 9 percent drop after details of the scandal became public in September 2016.

Former Chief Executive Officer John Stumpf will continue to face claims of insider trading. Tigar dismissed insider-trading claims against four other executives. Among them is Carrie Tolstedt, who ran the division where the accounts were created. Claims against her may be amended and refiled as additional allegations against Wells Fargo and its leadership, including Securities Exchange Act violations, may continue.

“Stumpf concealed the fact that the company had made substantial findings of the unlawful activity and actual fraud in its community banking segment as part of its investigation, which not only exposed millions of customers to unlawful fees and potential identity theft, but put the company in the cross-hairs of federal investigations,” shareholder Gary Hefler alleged in the complaint.

Cross-Selling

Central to the dispute is Wells Fargo’s practice of cross-selling, or using the sale of one product to push others. Millions of those additional accounts were created without consumer approval, then reported to shareholders in artificially inflated quarterly reports, according to the complaint. The bank and its executives’ statements “about the success of Wells Fargo’s cross-selling and its commitment to providing value for customers were both material and false or misleading,” Tigar wrote in the ruling.

“We disagree with the allegations in the complaint,” Ancel Martinez, a spokesman for the bank, said in an emailed statement. “We continue to take decisive steps to rebuild the trust of our customers, team members, community partners and shareholders and are focused on building a better Wells Fargo.”

The investor who sued seeks class-action status on behalf of all shareholders from Feb. 26, 2014, to Sept. 15, 2016.

Tigar linked the order to a similar derivative action in his court against Wells Fargo, in which he also ruled that shareholders may proceed with a suit alleging the company’s top brass “repeatedly and brazenly” failed to serve their best interests. That complaint properly laid out evidence showing executives and directors made false statements about the scheme in the bank’s filings to the U.S. Securities and Exchange Commission.

The shareholder case is Hefler v. Wells Fargo & Co., 3:16-cv-05479, U.S. District Court, Northern District of California (San Francisco).

Copyright 2026 Bloomberg.
Print Email
Claims / LegalClaims & ReservingCommercial LinesLitigation/Liability TrendsMarketsNewsThe C-SuiteU.S.

Was this article valuable?

Thank you! Please tell us what we can do to improve this article.

Thank you! % of people found this article valuable. Please tell us what you liked about it.

Here are more articles you may enjoy.

U.S. E&S Growth Slows Again; Declining Berkshire Volume Tops Leaders
Berkshire-owned PacifiCorp Utility Ruling Win Could Reduce Oregon Wildfire Damages
Allstate Joins Mobile Insurance App Leader GEICO; Top Carriers Expand Telematics Services: Keynova
Mississippi Home Mitigation Bill Heads to Governor in Effort to Improve Storm Resilience

Related Articles

Judge Rejects Wells Fargo Bid to End Predatory Lending Lawsuit
Wells Fargo Will Get Out of Personal Insurance Business
Wells Fargo Could Get $1B Fine to Resolve Auto Insurance, Mortgage Lending Abuses
Wells Fargo Suit Alleges Bank Encouraged Use of Hidden Fees in Finance Programs
Wells Fargo Reportedly Risks Record Fine From U.S. Consumer Watchdog for Various Abuses
Wells Fargo Settles Phony Bank Account Scandal for $142M
Wells Fargo Risks Calif. Suspension of Licenses Over Insurance Sales Practice Controversy
Hub International Will Acquire Wells Fargo’s Crop Insurance Broker Business
Wells Fargo Will Pay $480M to Resolve Fake-Accounts Lawsuit

Latest Magazine

Carrier Management magazine
View All

Research & Whitepapers

Free Newsletter

NewsletterSign up to receive daily news!

Features

  • How Insurance Leaders Can Leverage AI Without Sacrificing Trust
  • From Volatility to Value: How Carriers Can Build Durable Growth
  • Traveling for Business? Don’t Forget to Pack Your Emergency Preparedness Plan
  • How Insurance Can Turn Maintenance Into Measurable Competitive Advantage
  • Viewpoint: How Will the Middle East War Affect the Insurance Sector?
  • Is Commercial Auto Having It’s ‘Sprinkler Moment’?

Latest Magazine

Carrier Management magazine
View All
  • C-Suite
  • News
  • Leadership
  • Markets
  • Regulation
  • Top 50
  • Members Only
  • Videos

Headlines

  • P/C Industry Loss Reserves Redundant by More Than $20B: ...
  • How Modern is Modern Enough?
  • Liberty Mutual Done with Fixing, On to Building
  • Fixing Claims Negotiation (Part 5)

Resources

  • Videos / Podcasts
  • Contributors

Popular Topics

  • Boardroom Agenda
  • Technology
  • Financial
  • News

Brand Spotlight

  • Cotality
  • Cytora
  • HazardHub
  • Indico Data
  • Majesco
  • Verisk
  • Vertafore

Connect with us

  • Email Newsletters
  • Twitter
  • Facebook
  • LinkedIn
  • Do Not Sell My Info

Carrier Management

  • Submit Content
  • Advertise
  • Subscribe
  • Contact Us

Wells Media Group Network

  • Carrier Management iconCarrier Management
  • Insurance Journal iconInsurance Journal
  • Claims Journal iconClaims Journal
  • IJ Academy iconInsurance Journal Academy
  • Insurance Journal TV iconInsurance Journal TV
  • MyNewMarkets.com iconMyNewMarkets.com
© 2026 by Wells Media Group, Inc. Privacy Policy | Terms & Conditions | Site Map