A federal judge has approved an $85 million settlement resolving the Wells Fargo securities class action over fake diversity interviews. U.S. District Judge Trina Thompson granted final approval on May 21, 2026, ending roughly four years of litigation in the Northern District of California. Wells Fargo did not admit liability. The money goes to investors who bought Wells Fargo common stock during a defined window and lost value after the practices were made public.
Who Is Covered and What the Payout Looks Like
The settlement class includes all persons and entities who purchased Wells Fargo common stock between February 24, 2021, and June 9, 2022, and suffered losses as a result.1Courthouse News Service. $85 Million Settlement Over Wells Fargo Hiring Practices Inches Toward Approval The deadline to file a claim, opt back in, or object passed on April 14, 2026, and the fairness hearing was held on May 5, 2026.2Wells Fargo Securities Action. Wells Fargo Securities Action Settlement Epiq Class Action and Claims Solutions is administering claims.
The $85 million fund is allocated roughly as follows:
- Attorneys’ fees of $21.25 million, or 25% of the fund.
- Litigation costs of about $3.08 to $3.5 million.
- Class representative awards of up to $40,000 each.
- Administrative costs between $950,000 and $1.2 million.
- An estimated $59 million remaining for distribution to class members.3Banking Dive. Judge Approves $85 Million Wells Fargo Sham Diversity Hire Settlement
Any leftover funds that are not cost-effective to redistribute will be donated to the Council of Institutional Investors Research and Education Fund.1Courthouse News Service. $85 Million Settlement Over Wells Fargo Hiring Practices Inches Toward Approval Judge Thompson called the deal a “fair and reasonable” resolution.4HR Dive. Diverse Hiring Slate Sham Wells Fargo
What Wells Fargo Was Accused Of
The dispute goes back to a May 2022 New York Times report describing what employees called “sham” interviews. A Wells Fargo policy formally launched in 2020 required at least half of candidates interviewed for positions paying more than $100,000 a year to come from underrepresented groups, including racial minorities, women, veterans, people with disabilities, and LGBTQ individuals.5Courthouse News Service. Misrepresentation Claims Survive in Wells Fargo Fake Job Interview Class Action Current and former employees told the Times that managers were interviewing diverse candidates for jobs that had already been promised to someone else, and that the informal practice predated the written policy.6The New York Times. Wells Fargo Fake Interviews Investigation
Joe Bruno, a former wealth-management executive, said he was told to conduct interviews for filled positions and called the practice “inappropriate, morally wrong, ethically wrong.” He said he was fired in August 2021 after complaining internally.7The New York Times. At Wells Fargo, a Quest to Increase Diversity Leads to Fake Job Interviews About a dozen current and former employees confirmed the practice to the Times.8The New York Times. Wells Fargo Fake Job Interviews
Wells Fargo paused the policy in June 2022 and later reworked it to tie the diverse-candidate requirement to job level rather than salary.9Banking Dive. Wells Fargo Execs, Shareholders Settle Lawsuit Over Sham Diverse Hiring Interviews
The investors’ theory was securities fraud. Shareholders argued that Wells Fargo promoted its diversity hiring commitments through SEC filings and public remarks while running a system that made those commitments a sham, and that the bank’s stock dropped more than 10% after the Times report, wiping out roughly $17 billion in shareholder value.10Banking Dive. Investors, Judge, Wells Fargo Diverse Hiring Lawsuit, Charlie Scharf Plaintiffs also alleged that between 70% and 80% of open positions in the commercial banking division involved sham interviews.11Legal Dive. Wells Fargo Faces Lawsuit for Alleged Sham DEI Hiring
How the Case Reached Settlement
The lawsuit began with a June 2022 complaint by Khosrow Ardalan. After consolidation, Swedish institutional investor SEB Investment Management AB was appointed lead plaintiff, joined by the West Palm Beach Firefighters’ Pension Fund as a class representative. The case is SEB Investment Management AB et al. v. Wells Fargo & Co., No. 3:22-cv-03811.1Courthouse News Service. $85 Million Settlement Over Wells Fargo Hiring Practices Inches Toward Approval
Judge Thompson dismissed an early version of the complaint in August 2023. After the plaintiffs amended their filing with declarations from nine former employees, she reinstated the case in July 2024, finding the fake interviews were “systemic” and pointing to internal complaints allegedly sent to CEO Charlie Scharf and board members.11Legal Dive. Wells Fargo Faces Lawsuit for Alleged Sham DEI Hiring Wells Fargo argued that the policy only promised interviews, not hires; the judge rejected that defense. The parties reached the $85 million agreement in October 2025, avoiding trial.12Law360. Wells Fargo to Settle Investors’ Sham Hiring Case for $85M
The Related $110 Million Derivative Settlement
A week before final approval of the securities deal, Judge Thompson approved a separate $110 million settlement in a shareholder derivative case, In re Wells Fargo & Co. Consolidated Derivative Shareholder Litigation (No. 22-cv-05173). That case, brought on behalf of the company itself, alleged the board breached fiduciary duties by failing to address discriminatory hiring and lending practices, including data showing Wells Fargo approved fewer than half of Black homeowners’ refinancing applications in 2020.13Cotchett, Pitre & McCarthy, LLP. Federal Court Grants Final Approval of Historic Discrimination Settlement With Wells Fargo
Under that deal, Wells Fargo must create a $100 million fund for at least three years to provide mortgage assistance, including downpayment and closing-cost help, to low- and moderate-income borrowers and buyers in low- and moderate-income census tracts. The remaining $10 million is to be paid to Wells Fargo by the directors’ insurance carriers.14Bloomberg Law. Wells Fargo’s $110 Million Discrimination Settlement Is Approved That money is not paid to individual shareholders as such; it funds the mortgage assistance program and reimburses the company.
What Happened With the Investigations and the Whistleblower
The SEC and the Department of Justice both opened investigations into the hiring practices after the Times report.15Reuters. Wells Fargo Says SEC Is Examining Its Hiring Practices Both closed without enforcement action.16Compliance Week. Wells Fargo Says DOJ, SEC Diversity Hiring Probes Closed
Bruno pursued his own case. In November 2025, a FINRA arbitration panel ruled there was no valid and enforceable arbitration agreement, letting his claims proceed in court.17Claims Journal. Wells Fargo Whistleblower Wins Arbitration Ruling He filed Bruno v. Wells Fargo & Company (No. 3:25-cv-10808) in the Northern District of California in December 2025, alleging systemic racial discrimination and retaliation. That suit was still active as of mid-2026 and is separate from the $85 million class settlement.18Law360. Wells Fargo Sued by Ex-Exec Over Fake Diversity Interviews