Financial Services Spotlight

Bank Corporate Governance—Fed lowers Boom on Wells’ Directors

Posted by Roy Andersen on Feb 6, 2018 10:52:00 AM

On February 2, 2018, the Fed announced that it issued a consent Cease and Desist order with Wells Fargo—the bank holding company. The Fed’s press release noted that Wells is replacing 4 directors within this year (out of 17 that signed the C&D), but this reconfiguration is not a formal requirement of the C&D. Press reports imply that the Fed was behind these changes. Of course, Wells is as closely supervised by the Fed as any bank could be; nonetheless, the Fed takes no responsibility for the errors at Wells and shows no humility in passing out blame. It is without precedent for the Fed to write personal letters to former directors (as summarized below), roundly rebuke them and then publish the letters.  

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Topics: Wells Fargo, Corporate governance, Regulation YY

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The Financial Services Spotlight examines the regulatory and technology developments impacting banks, asset managers and other financial services providers—where challenges meet opportunities.

 

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Roy C. Andersen, of counsel in Sullivan & Worcester's New York office, is a member of the Corporate Department. Mr. Andersen focuses on bank regulatory and compliance matters, including international banks and their branches and agencies in New York.

Joel Telpner, partner in the firm's New York office, is a seasoned advisor, strategist and problem solver. Mr. Telpner brings more than 30 years of legal experience in a career that includes time as an AmLaw 100 partner, the former U.S. general counsel of a global financial institution, and a venture capitalist. He is recognized for his ability to deftly manage complex financial transactions, especially those involving sophisticated structured finance and derivatives matters and has an extensive and unique combination of transactional and regulatory experience.

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