Wells Fargo & Co would pay up to $2.5 million in attorneys' fees and implement certain corporate governance changes under a proposed settlement of lawsuits brought by shareholders on behalf of the company, according to a securities filing by Wells on Friday.
The suits were filed in U.S. District Court in Northern California in 2010 on behalf of Wells Fargo and its shareholders against current and former directors and executives largely related to conduct at Wachovia bank, which Wells bought in 2008.
The suits claim that from 2005 to 2008 the former Wachovia defendants disregarded "their fundamental responsibilities" with respect to Wachovia's acquisition of mortgage lender Golden West Financial and other activities at Wachovia, according to settlement documents. The suits also allege that Wells directors did not pursue "valuable claims" that it inherited in the Wachovia acquisition, according to the documents.
Wells bought Wachovia as the lender verged on collapse due to ballooning
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