The Securities and Exchange Commission today charged former Wells Fargo & Co. CEO and Chairman John G. Stumpf, 66, and the former head of Wells Fargo’s Community Bank Carrie L. Tolstedt, 60, for their roles in misleading investors about the success of the community bank based on its mass "cross sell" of unauthorized, fraudulent or unneeded products to existing customers.

Stumpf settled the charges for a $2.5 million penalty. The order found that in 2015 and 2016 Stumpf signed and certified quarterly and annual reports filed with the SEC “which he should have known were misleading, regarding both Wells Fargo’s Community Bank cross-sell strategy and its reported metric.” According to the order, Stumpf failed to assure the accuracy of his certifications after being put on notice that Wells Fargo was misleading the public about the cross-sell metric. Stumpf negotiated a separation with Wells Fargo in 2016, the SEC said.

In the SEC’s administrative proceeding, Stumpf, without admitting or denying the SEC’s findings, has agreed to cease and desist from committing or causing any future violations of the Securities Act of 1933 and to pay a civil penalty of $2.5 million. The SEC said in a press release it will combine this money with the $500 million Wells Fargo paid in its previous settlement and distribute the sum to harmed investors.

The agency also filed a complaint in U.S. District Court in California charging Tolstedt, who negotiated a separation package with the bank after news of the fraud began to break in 2016, with committing fraud. The SEC is seeking a permanent injunction, civil penalties, disgorgement with prejudgment interest and an officer-and-director bar.

In February, Wells Fargo settled charges and agreed to pay $500 million for misleading investors about the success of its community bank—its largest operating unit.

According to the agency’s new complaints, from 2014 to 2016, Wells Fargo publicly claimed that its business strategy was to sell to existing retail banking customers products through its published “cross-sell metric” featured in its annual reports and public filings.

“Contrary to these public statements, Tolstedt and Wells Fargo’s Community Bank—its largest operating segment—implemented a volume-based sales model in which employees sold volumes of products to existing customers, often with little regard to actual customer need or expected use. For several years, until mid-2016, Wells Fargo opened millions of accounts or sold products that were unauthorized or fraudulent, and others that were unneeded and unwanted by retail banking customers,” the SEC said.

In its complaint against Tolstedt, the SEC said that from mid-2014 through mid-2016, she publicly described and endorsed Wells Fargo’s “cross-sell metric” as a means of measuring Wells Fargo’s financial success and also signed misleading sub-certifications about the accuracy of Wells Fargo’s public disclosures “when she knew or was reckless in not knowing that statements in those disclosures regarding Wells Fargo’s cross-sell metric were materially false and misleading,” the agency said.

“At the same time Tolstedt engaged in the above acts and deceptions that sowed misinformation, she also sold shares in Wells Fargo. For instance, in November 2014, Tolstedt sold shares of Wells Fargo stock for more than $11.8 million,” the SEC said in its complaint.

“If executives speak about a key performance metric to promote their business, they must do so fully and accurately,” the director of the SEC’s Division of Enforcement, Stephanie Avakian, said. “The commission will continue to hold responsible not only the senior executives who make false and misleading statements but also those who certify to the accuracy of misleading statements despite warnings to the contrary."