As chairman of Wells Fargo, Timothy J. Sloan failed to resolve a series of scandals that rocked the bank and he abruptly resigned more than four years ago amid widespread criticism.
He now says Wells Fargo owes him at least $34 million in back payments.
Mr. Sloan sued Wells Fargo on Friday, saying the bank owed him unpaid stock awards, bonuses and unspecified “emotional distress.” His lawyers said the bank he formerly led made him a scapegoat for problems that predated his tenure, and they framed his resignation amid criticism in 2019 as “an act of further loyalty to the bank.”
The lawsuit was a surprising move as Wells Fargo has sought for years to put Mr. Sloan’s tenure behind him and improve its relationships with customers and regulators.
A Wells Fargo spokeswoman, Beth Richek, said the bank stands behind its decision to withhold the salary. “Compensation decisions are based on performance,” she said in a statement.
Once considered one of America’s best banks, Wells Fargo made headlines in 2016 after federal regulators revealed that it had put so much pressure on its employees to squeeze more money out of customers that employees secretly created millions of fake accounts under customers’ names opened scams and trick them into buying unnecessary products. Regulators said the practices date back to 2011.
The bank paid more than $1.5 billion in penalties to federal and state authorities and $620 million to settle lawsuits from customers and shareholders.
In 2018, the Federal Reserve forced the bank to curb its growth until it made changes to its culture.
Mr. Sloan, who took the bank’s top post in 2016 with a mandate to clean up the situation, suddenly resigned in 2019, shortly after he came under intense attack for his testimony defending his work on Capitol Hill. When a congressman asked if Wells Fargo could promise it would no longer hurt customers, he replied: “I can’t promise you perfection.”
Mr. Sloan’s lawsuit says he did not negotiate a severance agreement at the time “in a spirit of mutual trust.”
Source : www.nytimes.com