The Complaint alleges that during the Class Period, defendants made materially false and misleading statements regarding the Company’s true financial condition, financial performance and future prospects, including about the source of its growth in products per household and the success of its overall strategy of cross-selling its products.
Specifically, throughout the Class Period, defendants made false and misleading statements and/or failed to disclose that Wells Fargo’s cross-selling efforts to retail customers were neither designed to meet customers’ financial needs nor drive customer satisfaction, but rather were the product of a carefully designed system that resulted in the Company illegally, through forgery and other electronic means, opening millions of deposit and credit card accounts for customers without their knowledge in an effort to generate fee income for Wells Fargo and compensation rewards for Wells Fargo employees, including defendants.
Wells Fargo also failed to disclose that an ongoing internal investigation had in fact determined by the beginning of the Class Period that employees in the Community Banking segment had engaged in a wide ranging scheme to inflate the Company’s financial performance figures by opening millions of unauthorized deposit and credit card accounts, ultimately resulting in more than 5,000 employee terminations. As a result of defendants’ false statements and/or omissions during the Class Period, Wells Fargo stock traded at artificially inflated prices, reaching a high of over $58 per share and allowing certain defendants to sell more than $31 million worth of their own Wells Fargo stock at artificially inflated prices.
On behalf of all persons who purchased Wells Fargo & Company (“Wells Fargo” or the “Company”) common stock