Beginning Next Week: InsideCounsel will become part of Corporate Counsel. Bringing these two industry-leading websites together will now give you comprehensive coverage of the full spectrum of issues affecting today's General Counsel at companies of all sizes. You will continue to receive expert analysis on key issues including corporate litigation, labor developments, tech initiatives and intellectual property, as well as Women, Influence & Power in Law (WIPL) professional development content. Plus we'll be serving all ALM legal publications from one interconnected platform, powered by Law.com, giving you easy access to additional relevant content from other InsideCounsel sister publications.

To prevent a disruption in service, you will be automatically redirected to the new site next week. Thank you for being a valued InsideCounsel reader!

X

More On

Wells Fargo prepares for two year ethics review to avoid future legal suits

As the financial crisis continues, Wells Fargo readies for a two-year review that will redefine its business code of ethics and conflict best practices.

When you are one of the biggest banks in the country, chances are you are spending more time focused on your financial concerns than ethical ones. However, Wells Fargo will be spending the next two years preparing to conduct an internal review of its ethics due to lawsuits that have been sweeping the financial industry as of late. 

Mary Eshet, a spokeswoman for Wells Fargo, notes that the U.S. bank prides itself in its strong code of ethics already in place and credits its ethical business practices as being a cornerstone of the bank’s culture. Nevertheless, the self-initiated review will make room for new approaches and improvement within Wells Fargo’s system. 

The review, which starts Jan. 1, will last about 18-24 months and is being led by the newly formed Ethics Program Office and deputy general counsel Christine Meuers. Meuers not only performed the analysis on the review but is also continuing to look into best practices for how employees should act and handle conflicts of interest across more than 80 business lines.

Just last month, rumors circulated regarding Wells Fargo being the next bank to be investigated by the Financial Institutions Reform and Recovery Act, which has looked into Bank of America, JPMorgan Chase & Co, Credit Suisse, and Citigroup. With U.S. attorneys investigating Wells Fargo for more than a year, the investigations are evaluating where the firm was in violation of provisions under FIRREA. Could it be that Wells Fargo is joining other giant financers and lenders who have initiated similar reviews to avoid the scrutiny and legal challenges that have tarnished the reputations of big name banks?

According to a JournalNow report, the firm's employees already are held to a 24-page code of ethics that includes workers being barred from investing in or making a loan to a Wells Fargo customer or vendor unless it meets certain requirements. Employees also aren't allowed to accept gifts valued at more than $200 from customers.

Wells Fargo is hoping that by conducting this review, they will be able to avoid similar claims made against competitors such as Bank of America and JP Morgan Chase. The bank apparently has set aside $2.7 billion for litigation and legal matters from 2008 through June, according to data compiled by Bloomberg. That compares with $21.3 billion at JPMorgan, $19.1 billion at Bank of America and $8.1 billion at Citigroup.

  

For more legal news in the financial sector, check out these related articles:

Bank of America reaches $500 million settlement with investors

Fifth Third Bank to pay $6.5M to settle SEC charges

Los Angeles sues Bank of America for discriminatory lending practices

Contributing Author

Stefanie Mosca

Bio and more articles

Join the Conversation

Advertisement. Closing in 15 seconds.