SEC ORDER On November 13, 2017, the SEC announced that Wells Fargo Advisors, LLC agreed to
settle charges that it violated Section 17(a) of the Securities Exchange Act of 1934 and Rule 17a-8 by failing to file and timely file Suspicious Activity Reports between approximately March 2012 and June
2013. Without admitting or denying the allegations, the firm agreed to a cease and desist order, a censure, and a civil penalty of $3,500,000. Wells Fargo Advisors also agreed to voluntarily undertake a review and update of its policies
and procedures and develop and conduct additional training.
STATE OF ILLINOIS SETTLEMENT On December 21, 2017, Wells Fargo Advisors, LLC
(k/n/a Wells Fargo Clearing Services, LLC) entered into a Consent Order with the State of Illinois regarding allegations that it received, reviewed and/or analyzed documents and information provided by a financial advisory firm concerning certain
money manager strategies that contained false and misleading information. The findings stated that the firm included the financial advisory firms money manager strategies in certain of its separately managed account programs, but that the
firm did not utilize inaccurate historical performance data in connection with its decision to onboard the money manager strategies and the firm did not incorporate inaccurate performance data in its advertisements or program marketing materials.
Without admitting or denying the findings, the Firm agreed to a total monetary payment of $270,000.
NYSE SETTLEMENT On February 2, 2018,
Wells Fargo Prime Services, LLC (WFPS) and NYSE Arca, Inc. entered into an Offer of Settlement and Consent without admitting or denying any allegations to settle charges of violations of Securities Exchange Act Rule 15c3-5 and NYSE Arca Rule 11.18. The settlement related to an erroneous trade WFPS entered on July 29, 2016. WFPS consented to a fine of $10,000.
STATE OF NEVADA SECURITIES DIVISION RESIDENTIAL OFFICE INVESTIGATION On April 13, 2018, the Nevada Securities Division and Wells Fargo Clearing
Services, LLC (WFCS) entered into an Administrative Consent Order wherein WFCS admitted to failing to register the residential offices of three Financial Advisors who were working from home. Nevadas definition of branch
office includes a personal residence where securities business is transacted, even if the residence is not held out to the public or used for client meetings. WFCS agreed to pay an $8,000 fine and $1,446.13 for the costs of the examinations
conducted by the Nevada Securities Division.
SEC SETTLEMENT On June 25, 2018, Wells Fargo Advisors LLC (WFA), entered into a
settlement agreement with the SEC wherein, without admitting or denying liability, it settled charges of violations of Sections 17(a)(2) and 17(a)(3) of the Securities Act. The settlement related to certain registered representatives soliciting
customers to redeem, and short-term trading of, market-linked investments prematurely without adequate analysis or consideration of the substantial costs associated with the transactions. As part of the settlement, the firm consented to a
censure and a payment of $5,108,441.27 representing disgorgement, prejudgment interest, and a civil penalty. WFA also lost its Well Known Seasoned Issuer status as a collateral consequence of the settlement.
COMMONWEALTH OF MASSACHUSETTS SECURITIES DIVISION SETTLEMENT On August 26, 2018, the Massachusetts Securities Division of the Office of the
Secretary of the Commonwealth and Wells Fargo Clearing Services, LLC (WFCS) entered into a Consent Order regarding allegations that certain WFCS supervisors and agents had a lapse in required Massachusetts registration for some period
during the relevant time period of January 1, 2016 to June 28, 2018. Without admitting or denying the facts or conclusions of law, WFCS agreed to certain undertakings including payment of an administrative fine of $450,000.
SEC SETTLEMENT On March 11, 2019, the SEC announced that Wells Fargo Advisors, LLC, and Wells Fargo Advisors Financial Network, LLC
(collectively Wells Fargo) agreed to settle charges, without admitting or denying liability, that Wells Fargo violated Section 203(e) and 203(k) of the Investment Advisers Act of 1940. The settlement relates to Wells
Fargos voluntary participation in the SECs Share Class Selection Disclosure Initiative wherein investment advisers were encouraged to self-report the failure to adequately disclose conflicts of interest associated with the
recommendation or selection of a mutual fund share class that charged distribution fees (12b-1 Fees) when a lower-cost share class of the same fund existed. The settlement requires Wells Fargo
to adhere to a cease-and-desist order and to disgorge $17,363,847.29 in 12b-1 fees through a restitution program. The
settlement did not require Wells Fargo to pay any additional fines or penalties given its voluntary participation in the program.