Former Wells Fargo CEO, Tim Sloan, filed a $34 million lawsuit against the bank for withheld pay and stock. Sloan alleges Wells Fargo canceled stock awards and withheld a bonus he earned before resigning in 2019 amid a sales scandal. The bank, in response, stated that compensation decisions are performance-based.
Leading Wells Fargo from 2016 to 2019, Sloan became the second CEO to step down over unauthorized accounts claims. In 2020, Wells Fargo agreed to pay $3 billion to settle probes into the scandal and an additional $1 billion in a shareholder lawsuit. The scandal prompted the Federal Reserve in 2018 to cap the bank’s assets at $1.95 trillion.
Sloan, denying responsibility for the scandal, claims he was made a scapegoat and forced to resign. He contends Wells Fargo failed to justify its decision and accuses the bank of breach of contract. Seeking $34 million, Sloan also seeks damages for emotional distress and punitive damages.
At the time of his resignation, Sloan cited the distraction his role was causing. His lawyer, David Lowe, based in San Francisco, has handled high-profile employment lawsuits, including cases involving Tesla and Pinterest. The lawsuit adds to the challenges Wells Fargo faces in the aftermath of the sales practices scandal.
In conclusion, Tim Sloan’s lawsuit against Wells Fargo sheds light on ongoing challenges post-scandal. The legal battle underscores the complexities of executive compensation and accountability in the corporate world.