As the former chief executive of Wells Fargo, Timothy J. Sloan failed to address a series of scandals that rocked the bank and resigned amid widespread criticism over four years ago.
Now, he claims Wells Fargo owes him at least $34 million in unpaid stock awards, bonuses, and unspecified “emotional distress.”
Mr. Sloan filed a lawsuit against Wells Fargo, alleging that the bank owed him compensation for issues that existed before his time as C.E.O. His legal team portrayed his 2019 resignation amidst controversy as “an act of further loyalty to the bank.”
The lawsuit took the bank by surprise, as Wells Fargo has been working to move past Mr. Sloan’s tenure and improve its standing with customers and regulators.
A spokesperson for Wells Fargo, Beth Richek, defended the bank’s decision to withhold the compensation, stating, “Compensation decisions are based on performance.”
Wells Fargo, once considered one of America’s top banks, made headlines in 2016 when federal regulators uncovered the unauthorized opening of millions of fake accounts and deceptive sales practices dating back to 2011.
The bank faced over $1.5 billion in penalties to federal and state authorities, as well as a $620 million settlement for lawsuits from customers and shareholders.
In 2018, the Federal Reserve imposed growth restrictions on the bank until it addressed its cultural issues.
Mr. Sloan, tasked with cleaning up the organization when he took over as CEO in 2016, abruptly resigned in 2019 following tough questioning during a congressional hearing. He did not negotiate a severance agreement at the time, citing “mutual trust.”
