SEC Imposes Monetary Penalty and Disgorgement on Former Wells Fargo's Executive Carrie Tolstedt for Misleading Investors.

In its litigation against Wells Fargo, the SEC has now reached a settlement with former Community Bank CEO Carrie Tolstedt. Tolstedt was accused of making misleading public statements and signing misleading sub-certifications regarding Wells Fargo’s cross-sell metric, which was purportedly used to measure financial success but was actually inflated by accounts and services that were unauthorized or unused. Without admitting or denying the SEC’s allegations, Tolstedt agreed to a final judgment permanently enjoining her from any further violations and imposing a permanent officer-and-director bar. In addition, Tolstedt agreed to pay a $3 million penalty plus disgorgement of $1,459,076 plus prejudgment interest of $447,874. The SEC will combine these funds with $500 million from Wells Fargo and $2.5 million from former CEO John Stumpf, previously settled related charges, and distribute the total amount to harmed investors. Settlement is subject to court approval.