Former Wells Fargo Executive Carrie Tolstedt Agrees to Pay $3 Million SEC Fine

By Mary de Wet

The former head of Wells Fargo & Co.'s community bank, Carrie Tolstedt, has agreed to pay a $3 million penalty stemming from charges brought in 2020 for her role in allegedly misleading investors, the Securities and Exchange Commission said Tuesday.

Tolstedt in March pleaded guilty to obstructing regulators who tried to examine allegations of sales misconduct at the business she ran.

The SEC previously settled related charges against Wells Fargo and its former CEO and chairman, John Stumpf.

Tolstedt, who retired from the bank in 2016, was a key figure in the fake-accounts scandal, in which regulators alleged that executives set high sales goals that encouraged low-level employees to open fake and unauthorized bank accounts.

Without admitting or denying the SEC's allegations, Tolstedt agreed to a final judgment permanently enjoining her from violating the antifraud and other provisions of the federal securities laws and imposing a permanent officer-and-director bar, the commission said.

In addition to the $3 million civil penalty, Tolstedt agreed to pay disgorgement of $1.5 million plus prejudgment interest of $447,874, the SEC said.

The SEC said it would combine this money with $500 million paid by Wells Fargo and the $2.5 million penalty paid by Stumpf in previous settlements and distribute the sum to harmed investors. The settlement is subject to court approval.

Under a separate settlement with the Office of the Comptroller of the Currency, Tolstedt has been barred from the banking industry and must pay a $17 million fine.

Write to Mary de Wet at mary.dewet@dowjones.com

(END) Dow Jones Newswires

May 30, 2023 17:56 ET (21:56 GMT)

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