In an effort to charge higher fees, entice borrowers who wanted large loans and become the biggest commercial lender in the country, Wells Fargo was incentivized to originate and sponsor risky loans, the shareholders argued.
The shareholders said Wells Fargo inflated the quality of its commercial loans and misled investors about its lending practices.
The investors allege that during the COVID-19 pandemic, Wells Fargo incurred losses in its commercial lending business as a result of previously undisclosed risks.
