Bank of America Corp (BAC), JPMorgan Chase & Co. (JPM), Wells Fargo & Co (WFC): New Legal Woes Bring Banks Down a Notch

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Lending a helping hand
Wells Fargo & Co (NYSE:WFC)
wrapped up a second trial over its securities lending program this week. Investors claimed that the bank advertised the program as a safe investing option, misrepresenting the risk and causing them to lose millions. This is just the second of at least five such cases filed against the bank, with Wells Fargo & Co (NYSE:WFC) losing the first case that went to trial and paying Minnesota Workers’ Compensation Reinsurance Association and three other foundations $30 million. The current case is in jury deliberations as of this morning, and two more cases are scheduled to begin next year.

Legal woes
Investors have had to deal with the banks’ legal issues since before the financial crisis. But now that new cases are being brought against the banks — woes that may not qualify as legacy issues — there’s a new layer of uncertainty clouding the investment opportunities posed by the Big Four. Though these may just be more bumps in the road, make sure you’re comfortable with the legal risks each of these banks carry with them.

The article New Legal Woes Bring Banks Down a Notch originally appeared on Fool.com and is written by Jessica Alling.

Fool contributor Jessica Alling has no position in any stocks mentioned. The Motley Fool recommends Bank of America, Goldman Sachs, and Wells Fargo. The Motley Fool owns shares of Bank of America, JPMorgan Chase, and Wells Fargo.

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