In the United States, the Securities and Exchange Commission on Tuesday, May 30, announced an agreement with the former head of the Community Bank Wells Fargo & Co. Carrie L. Tolstedt.

As part of this agreement, Carrie L. Tolstedt undertook to pay a fine of $ 3 million. This measure of influence is the result of accusations against her about her involvement in the practice of providing investors with misleading information about the results of the activities of the Community Bank, Wells Fargo’s main business. These charges were brought against Carrie L. Tolstedt in 2020.

The text of the SEC complaint against the former head of the bank contains information that from mid-2014 to mid-2016, she publicly described and approved Wells Fargo’s cross-selling indicator as a tool for determining financial dynamics. At the same time, this indicator was not objective, because it was overestimated due to accounts and services that were not used, were not authorized, and were classified as necessary.

The complaint also alleges that Carrie L. Tolstedt reliably knew that the cross-selling indicator is not an accurate indicator of tracking accounts and products that are needed by customers of a financial institution and are actively used by them. According to the SEC, she was informed about the use of illegal practices in a Public bank, in which workers of the organization imposed products on consumers that they did not need. These actions of employees of the financial institution included, among other things, unauthorized opening of accounts.

The complaint alleges that Carrie L. Tolstedt made statements containing misleading information at Wells Fargo investor conferences in 2014 and 2016. The SEC also states that she signed the sub-certifications regarding the accuracy of the public disclosure of the lender’s information, knowing or not having previously inquired that the cross-selling indicator is taken into account in this case. The data provided to investors is misleading and false.

Monique K. Winkler, regional director of the SEC’s regional office in San Francisco, said that companies do not act on their own and announced their readiness to hold accountable those representatives of senior management who are involved in committing actions that violate securities laws.

Carrie L. Tolstedt agreed with the final ruling of the court. She did not comment on this decision in any way in terms of agreeing with it or denying her involvement in illegal activities. In addition to the $3 million civil fine, Carrie L. Tolstedt agreed to pay compensation of $1.4 million plus interest for early repayment of $447.8 thousand.

The SEC will combine the compensation and fine amounts with the $500 million paid to Wells Fargo and the $2.5 million fine paid to Stumpf in previous settlements. These funds will be distributed among the affected investors.

As we have reported earlier, NYDFS Fines OneMain for Cybersecurity Violations.