The federal court judge tasked with reviewing the pending $142 million settlement for the millions of fake accounts opened in customers’ names isn’t ready to rubber-stamp the deal. In fact, the judge’s questions about this settlement appear to indicate that he may reject the agreement.

Judge Vince Chhabria issued an order [PDF] last night asking lawyers for both parties to address a number of issues, like an apparent sudden jump in the possible number of bogus accounts.

As we reported last week, a memorandum in support of the settlement mentioned that the total number of fraudulent accounts could be as high as 3.5 million — a huge increase over the 2.1 million figure that has been used since Wells reached its $185 million settlement deal with federal and state regulators in 2016.

“How did the estimated number of false accounts rise from 2.1 million in the opening brief to 3.5 million in the reply brief?” asks Chhabria, who also questioned both parties’ ability to provide an accurate headcount of the various types of fake accounts that were opened.

The judge also noted that the plaintiffs attorneys seem to be ignoring the fact that, if Wells were to lose at trial, it would likely have to punitive damages on top of the actual damages suffered by the Wells customers.

“Has counsel for the plaintiffs unduly discounted the likelihood of a significant punitive damages recovery?” asks the court order.

Given the sheer number of Wells customers who could potentially file claims to this settlement (and the many, many attorneys who will get a piece of the settlement pie), it’s possible that there may be more claims for actual damages than this settlement could pay out.

“How can the Court be sure that all class members who suffered actual damages will be fully compensated for actual damages?” asks Chhabria, noting that customers whose credit scores were dinged by the fraudulent accounts are a particular concern. “What will the plaintiffs’ counsel request if one of the settlement pools runs out of money for compensatory damages?”

The judge also points to a few conditions in the agreement that he is likely to reject — like a provision barring plaintiffs from pursuing other claims against Wells — and wants to know if getting rid of these clauses would be a dealbreaker, forcing him to reject the entire settlement.

Attorneys for both sides were directed to file response briefs today.

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