Wells Fargo agrees to pay $32.5 million to settle 401(k) lawsuit

Wells Fargo agrees to pay $32.5 million to settle 401(k) lawsuit
The settlement, filed in U.S. District Court for the District of Minnesota, relates to the 401(k) plan's use of the bank's own offerings.
APR 05, 2022

Wells Fargo & Co. has agreed to pay $32.5 million to settle a class-action lawsuit that alleged the company violated sections of the Employee Retirement Income Security Act.

Yvonne Becker, who was a participant in Wells’ $40 billion 401(k) plan and an employee for 26 years, filed suit against Wells Fargo in 2020. The lawsuit alleged that several proprietary collective investment trusts in the 401(k) plan, including Wells Fargo's target-date series, were bad choices because less expensive, better-performing products were available from third parties.

The settlement, filed April 1 in U.S. District Court for the District of Minnesota, recovers 40% of plan participant's estimated fee damages. Plaintiffs estimate that at least 400,000 class members invested in at least one of the challenged funds, according to court papers.

Under the proposed settlement, payments will be automatically deposited in the Wells Fargo 401(k) plan accounts of all current participants, while former participants will receive their distribution via check, or as a roll-over into a qualified retirement account.

Latest News

Advisor moves: BofA bags $5B Citi advisor as Raymond James announces Janney hire
Advisor moves: BofA bags $5B Citi advisor as Raymond James announces Janney hire

Bank of America gains strength in NY a veteran UHNW advisor while RayJay welcomes a three-decade industry veteran in Georgia.

Despite rocky market, ETF launches for retail mavericks rolls on
Despite rocky market, ETF launches for retail mavericks rolls on

A decline in bullishness across Wall Street has not stifled financial innovation in the ETF industry, with scores of new funds minted including leveraged and exotic bets.

US futures higher on Fed rate cut expectation
US futures higher on Fed rate cut expectation

China may suspend some tariffs on US goods.

Alphabet beats sales expectations on Google search revenue
Alphabet beats sales expectations on Google search revenue

Shares up 5% in premarket trading following stronger results.

How hedge funds are navigating anti-climate agenda
How hedge funds are navigating anti-climate agenda

Trump policies mean finding new ways to gain from low-carbon bets.

SPONSORED Compliance in real time: Technology's expanding role in RIA oversight

RIAs face rising regulatory pressure in 2025. Forward-looking firms are responding with embedded technology, not more paperwork.

SPONSORED Advisory firms confront crossroads amid historic wealth transfer

As inheritances are set to reshape client portfolios and next-gen heirs demand digital-first experiences, firms are retooling their wealth tech stacks and succession models in real time.