Economics
Wells Fargo Sued by SEC Over Bond Sale for Curt Schilling
- Bank and Rhode Island didn't disclose cash shortfall, SEC says
- Former Red Sox star's company needed an additional $25 million
Curt Schilling.
Photographer: Scott Eells/BloombergThis article is for subscribers only.
Wells Fargo & Co. and a Rhode Island government agency were sued by a U.S. regulator for allegedly misleading investors about how much money a company led by former Boston Red Sox pitcher Curt Schilling needed to develop a video game.
After being hired to find financing for Schilling’s 38 Studios LLC, Wells Fargo failed to disclose that the $50 million raised from a bond offering was at least $25 million short of what the company needed to bring the game to market, the Securities and Exchange Commission said in a statement Monday. The Rhode Island Economic Development Corp. also knew that the bond sale wouldn’t raise enough money for Schilling’s company, the SEC said.