Wells Fargo & Co. agreed to pay $32 million to settle a lawsuit alleging its subsidiary Wachovia Securities LLC discriminated against female financial advisers by blocking career advancement and paying them less than men.
Wells Fargo and lawyers for a class of about 1,200 plaintiffs asked a federal judge in Washington today to approve the terms of the settlement, which calls for internal changes aimed at promoting female advisers and four years of monitoring by outside counsel.
U.S. District Judge Colleen Kollar Kotelly said that she had no problems with the core terms of the settlement agreement and would issue a ruling “as fast as I can.”
The lawsuit was filed two years ago by three employees of Wachovia Securities alleging the company had since 2003 systemically denied equal employment opportunities to its female financial advisers, keeping women from moving into more “prestigious roles” or management positions.
“While Wells Fargo Advisors has consistently denied the allegations of discrimination, the firm believes resolving this matter is in the best interests of the company,” Tony Mattera, a Wells Fargo Advisors spokesman, said in an e-mailed statement.
The settlement, which was initially reached in December, covers female financial advisers of Wells Fargo Advisors, A.G. Edwards and Prudential Securities as of the date they joined the firm, as well as female financial advisers at Wells Fargo Investments as of the date of the merger between San Francisco-based Wells Fargo and Wachovia in 2008, Mattera said.
Wachovia bought A.G. Edwards Inc. in 2007 and acquired Prudential Financial Inc.’s brokerage unit in 2003.
Cyrus Mehri, a lawyer for the plaintiffs, said in court that the average payout from the settlement will be about $18,000 a plaintiff. Under the terms of the settlement, the plaintiffs’ lawyers will receive about $10.5 million in fees and monitoring costs.
The case is Carter v. Wells Fargo Advisors LLC, 09-cv-01752, U.S. District Court, District of Columbia (Washington).