Strong Financial Corporation, which last week reached a $140m (€116m) settlement with US regulators over its role in the improper US mutual fund trading scandal, has been bought by Wells Fargo, the financial services group, for roughly $500m.

The deal will be a boost to Richard Strong, the former chief executive and founder with a 85% stake, who must pay $60m out of his own pocket as part of the settlement reached with the Securities and Exchange Commission. He has also been banned from the mutual fund industry for life for his role in the scandal which swept the US.