Wells Fargo & Co. (WFC) agreed to pay $125 million to settle accusations by investors that the bank misled them about the risks of mortgage-backed securities it sold.
The plaintiffs in the consolidated group case, or class action, include the General Retirement System of Detroit, New Orleans Employees’ Retirement System and other public pensions, according to the settlement filed yesterday in federal court in San Jose, California.
Wells Fargo, the largest U.S. home lender, and several investment banks that underwrote the securities were sued in 2009 over alleged violations of securities laws in connection with sales of mortgage pass-through certificates. The bank and the underwriters deny wrongdoing, according to the court filing.
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