Wachovia pays up…

April 25, 2008

Last Tuesday, we footnoted about an interesting disclosure in Wachovia’s (WB) 8K announcing first quarter earnings. There was new language about a potential restitution involving a former Wachovia customer called Payment Processing Center that had bilked lots of people — many of them elderly — and that at least some Wachovia executives seemed to know about, juding by this article from the NY Times.

The Comptroller of the Currency issued this release noting that Wachovia will be required to pay up to $144 million in restitution (though the actual figure could be considerably less). Wachovia’s stock bounced on the news, presumably because it could have been much worse.

Still, it seems kind of odd that Wachovia had no idea this was coming, nor any idea about what the number might be. After all, these sorts of settlements take time and presumably there had been some numbers bandied about prior to today’s press release.

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