A Broward jury on Tuesday ordered one of the biggest banks in America to pay $826 million to the children of the Seminole Tribe of Florida, the beneficiaries of a trust they say was mismanaged to yield anemic returns for more than a decade.
The award is one of the biggest in Broward County history, if not the biggest, said WIlliam Scherer, lead attorney for the beneficiaries of the Minors Per Capita Payment Trust, established in 2005 at Wachovia Bank, which was taken over by Wells Fargo three years later.
Wells Fargo was removed from the trust in 2016 after Tribe officials reviewed the rate of return and questioned the charging of $7.6 million in illegal fees. Those fees were part of the jury’s award, which considered how much the trust would have made had the money been invested more aggressively.
Attorneys for the bank blamed Tribe leaders for insisting on a conservative strategy to avoid market losses.
But Scherer said the trust was established in a way that made the bank the final arbiter of investment strategy, not the Tribe.
“The Tribe hired the bank because the bank has the expertise,” Scherer said, adding that he expects Wells Fargo to appeal the verdict.
Wells Fargo vows to appeal massive Seminole trust fund verdict
Children of Tribe members receive a payout when they reach maturity, which was considered age 24 by the terms of the trust in 2016. Before they receive payment, they must take a financial management course and demonstrate that they are drug-free.
In 2016, the Trust had about $1.4 billion in assets. The number now is about $3 billion, with the amount growing monthly from the Tribe’s gaming interests throughout the state, including the Seminole Hard Rock Hotel and Casino in Hollywood. The payout for each child is estimated between $2 million and $3 million.
“Wells Fargo lost sight of its responsibility to protect and preserve the interests of the Seminole minor children,” said plaintiffs’ lawyer Steven Osber, who delivered some of the more financially complex arguments to the jury during closing arguments Monday. “The jury spoke loud and clear when it rendered its verdict and awarded every dollar the kids deserved.”
Attorneys for the bank could not be reached for comment after the verdict.
Rafael Olmeda can be reached at rolmeda@sunsentinel.com or 954-356-4457. Follow him on Threads.net/@rafael.olmeda.
