Wells Fargo class action alleges company overcharged 401(k) for stock potions

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Wells Fargo 401(k) class action lawsuit overview: 

• Who: Lawrence Beville, Aryne Randall, and Scott Kuhn filed a class action lawsuit against Greatbanc Trust Company, Wells Fargo & Co. and its Employee Benefit Review Committee and former CEO Timothy J. Sloan. 
• Why: Beville, Aryne, and Kuhn claim Wells Fargo overcharged employees for their 401(k) stock option plans by doctoring the real value of its employee stock ownership plan.
• Where: The class action lawsuit was filed in Minnesota federal court. 

Wells Fargo overcharged workers on their 401(k) stock options plans by doctoring the true value of its employee stock ownership plan (ESOP), a new class action lawsuit alleges. 

Plaintiffs Lawrence Beville, Aryne Randall, and Scott Kuhn—all former Wells Fargo workers—claim the financial institution violated the Employee Retirement Income Security Act (ERISA) by how it managed the plans. 

The class action lawsuit comes on the heels of Wells Fargo agreeing to pay $145 million after the U.S. Department of Labor launched a probe into the company’s management of its 401(k) plans, reports Law360. 

Beville, Randall and Kuhn argue that Wells Fargo and Greatbanc Trust Company—the trustee for its ESOP plan—made the retirement plan pay beyond fair market value whenever it would obtain stock options preferred by Wells Fargo. 

Wells Fargo is restricted by ERISA regulations from valuing preferred stock above fair market value on account of the fact that it is not eligible to be traded on a public market, according to the Wells Fargo class action. 

Wells Fargo accused of keeping excess divided income for itself

Beville, Randall and Kuhn argue Wells Fargo further took the extra income and used it “to meet its employer matching contribution obligations, which contributions were a contractual and ERISA liability of Wells Fargo.” 

“In short, the excess dividend income was used for the benefit of Wells Fargo, not for the benefit of the Plan and its participants and beneficiaries,” states the Wells Fargo class action. 

Beville, Randall and Kuhn want to represent a class of individuals who have participated in the Wells Fargo & Co. (401)k plan since Sept. 27, 2016. 

Plaintiffs are demanding a jury trial and requesting declaratory and injunctive relief along with an award of appropriate equitable relief for themselves and all class members. 

Wells Fargo also agreed to pay $94 million this month in order to resolve claims it automatically and without consent placed mortgage holders who were struggling into a forbearance program during the pandemic. 

Have you participated in Wells Fargo & Co.’s 401(k) plan? Let us know in the comments! 

The plaintiffs are represented by  Paul J. Lukas, Steven Andrew Smith, and Brock J. Specht of Nichols Kaster PLLP; Gregory Y. Porter and Mark G. Boyko of Bailey & Glasser LLP, and Nina Wasow, Daniel Feinberg, and Todd Jackson of Feinberg Jackson Worthman & Wasow LLP.

The Wells Fargo 401(k) class action lawsuit is Beville, et al. v. Greatbanc Trust Company, et al., Case No. 0:22-cv-02354, in the U.S. District Court for the District of Minnesota. 

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