Wells Fargo Admits to Overcharging Accounts $26.8 Million and Agrees to Pay Penalty of $35 Million.

The Securities and Exchange Commission today charged Wells Fargo Clearing Services LLC and Wells Fargo Advisors Financial Network LLC with overcharging more than 10,900 investment advisory accounts a total of $26.8 million in advisory fees. To settle the charges, Wells Fargo agreed to pay a civil penalty of $35 million. The SEC’s order found that certain financial advisers from Wells Fargo and its predecessor firms had agreed to reduce their standard, pre-set advisory fees for certain clients but failed to enter the reduced rate into the firms' billing systems when setting up the respective accounts. As such, the accounts were billed at the higher rate instead. Additionally, Wells Fargo had failed to adopt policies or procedures to ensure that the billing system data was accurate or prevent instances of overbilling. To rectify the situation, Wells Fargo reimbursed affected accountholders approximately $40 million with interest. Without admitting or denying the SEC's charges, Wells Fargo consented to a cease-and-desist order and censure.