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The
agency claimed that the former executives misled investors about
the widespread sales practice problems at the bank. Stumpf
agreed to pay a $2.5 million penalty to settle the charges,
while the SEC will litigate fraud charges against Tolstedt in
court.
A lawyer for Stumpf did not immediately respond to a request for
comment. An attorney for Tolstedt said she was an "honest and
conscientious executive," and the SEC charges are "unfair and
unfounded."
The new charges mark the latest in a long-running set of legal
and regulatory woes for the bank and its former leadership,
after the firm was embroiled in a massive scandal over the
creation of fake accounts by employees. In February, the bank
agreed to pay $3 billion to settle a joint probe by the SEC and
Justice Department.
Stumpf and Tolstedt have faced individual sanctions as well.
Stumpf was barred from the banking industry and fined $17.5
million by a banking regulator in January, and Tolstedt is
facing a $25 million fine which she is fighting in court.
In the latest charges, the SEC said the pair misled investors
about the health of their sales practices, and they should have
known about deep-seated issues within the bank.
(Reporting by Pete Schroeder; Editing by Toby Chopra, Kirsten
Donovan)
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