Tim Sloan sued Wells Fargo & Co. for greater than $34 million, saying the corporate illegally withheld years of unpaid compensation after he stepped down as chief govt officer in 2019.
Sloan is searching for to pressure Wells Fargo to honor a number of canceled inventory awards and a bonus he says he was promised, in line with a grievance filed Friday in California state court docket. He’s additionally searching for unspecified damages for, amongst different issues, emotional misery.
The previous CEO led Wells Fargo from October 2016 to March 2019, a interval by which issues multiplied throughout enterprise traces and the financial institution was hit with expensive regulatory penalties, together with a Federal Reserve-imposed cap on progress that has but to be resolved.
Sloan claims in his go well with that these issues predated his tenure, and that he labored to right them as CEO. He mentioned nobody on the board blamed him till they turned the topic of political and media criticism after his departure from the financial institution.
Wells Fargo is “depriving Mr. Sloan of tens of thousands and thousands of {dollars} in deferred compensation he had earned throughout his profession,” in line with the grievance. “To at the present time, Wells Fargo has didn’t establish something Mr. Sloan did or failed to try this would justify its choice.”
Whereas it’s commonplace for monetary corporations to face authorized battles over deferred pay, it’s uncommon on the CEO stage. When Wells Fargo introduced Sloan’s exit, it described the transfer as “his choice” and mentioned it mirrored his “dedication” to the corporate, characterizations cited in Sloan’s grievance.
“Compensation selections are primarily based on efficiency, and we stand by our selections on this matter,” a spokesperson for Wells Fargo mentioned.
Sloan, 63, took over Wells Fargo weeks after a scandal involving faux buyer accounts erupted on the agency. John Stumpf, his predecessor who had run the financial institution since 2007, stepped down amid intense scrutiny from Washington and past.
Reform Makes an attempt
As president and chief working officer, Sloan was Stumpf’s apparent substitute from contained in the agency. He rose by means of the wholesale arm relatively than the patron division the place staff had created thousands and thousands of unauthorized accounts to satisfy gross sales objectives.
After taking up, Sloan launched a collection of reforms, saying in a 2018 Bloomberg interview: “You title it, we’ve modified it.”
However as an insider, he confronted criticism from the beginning that he wasn’t the fitting particular person to repair the financial institution, regardless of being largely exonerated in a 2017 board investigation into the fake-accounts scandal. These objections grew louder as issues multiplied and regulators turned more and more — and publicly — annoyed with the tempo of the clean-up.