The number of class-action lawsuits filed against Wells Fargo & Co. over its cross-selling has increased by one.
Steve Klein, on behalf of those who held Wells securities fromFeb. 26, 2014, through Sept. 15, 2016, is suing the company, CEO John Stumpf, CFOJohn Shrewsberry and former Community Banking Head Carrie Tolstedt for securitiesfraud.
Klein argues the defendants deliberately "concealed thata material part of the source of Wells Fargo's record cross-selling across the companywas based on fraudulent activity," making Wells' stock "artificially inflated."During this artificial inflation, he says, Stumpf and Tolstedt sold Wells stockworth more than $31 million. Since the illegal practices were revealed, the fallin stock price has "[inflicted] billions of dollars of harm" on shareholders,according to the complaint.
Warren Buffett, who owns almost 10%of the stock and had considered owning more, has refused to comment on the matter for the time being.
Other investor lawsuits include onefiled by the Vladimir Gusinsky Revocable Trust over an alleged and another byGary Hefler claiming securities lawviolations. Known shareholder activists have also filed to be considered at the next annualmeeting.