The company has been sued again over its use of its own products in its retirement plan.
Plaintiff Yvonne Becker, who was a participant in Wells’ $40 billion 401(k) plan and an employee for 26 years, filed a class-action lawsuit against Wells Fargo Friday in U.S. District Court in the Northern District of California.
Ms. Becker alleges that the company, along with the 401(k) plan committee, several individuals and Galliard Capital Management, violated sections of the Employee Retirement Income Security Act.
The allegations center on the inclusion of several collective investment trusts in the plan, including Wells Fargo’s target-date series. The suit alleges that the investments were poorly chosen, as less expensive, better-performing products were available from third parties.
“Despite the lack of a track record, the committee defendants ‘mapped,’ or transferred, nearly $5 billion of participant retirement savings from the plan’s previous target date option into the target date CITs,” the complaint stated. “At a minimum, prudent fiduciary process requires a three-year performance history for an investment option prior to its inclusion in a plan.”
The lead plaintiff in the new lawsuit is represented by law firm Cohen Milstein Sellers & Toll, which also represented plaintiffs in the prior lawsuit involving the target-date mutual funds.
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