As it finds itself under investigation from multiple government agencies and still reeling from a fake accounts scandal, Wells Fargo has chosen a lawyer to pilot the ship as it hunts for a permanent CEO.
Attorney C. Allen Parker left a prestigious New York law firm to become the general counsel for Wells Fargo two years ago, when the embattled financial institution’s troubles had already surfaced.
“I did not get much of a period to break in. I had to learn very quickly the general lay of the land,” Parker told an interviewer from Corporate Counsel a few months later.
But Parker should now expect even bigger challenges ahead.
On March 29, the Wells Fargo board announced that for an interim period, Parker will replace the company’s abruptly-departing CEO Tim Sloan. The news comes at a time when waves of regulatory actions and unfavorable headlines still dog the company, and the constant drum of bad news about Wells Fargo drags down its wirehouse’s financial advisors’ brand.
“He cannot underestimate how tired his advisors are from reading about their firm in the press and answering questions about Wells and the integrity at Wells. A poorly-handled transition will put their franchise at risk,” says recruiter Danny Sarch, president of White Plains, N.Y.-based Leitner Sarch Consultants.
For Parker, who starts as interim CEO immediately, the new assignment heaps on him perhaps more responsibility than he has held previously in his entire 35-year professional career. Parker didn’t even rank among the five top-compensated executives at Wells Fargo in the company’s 2019 proxy.
But Parker brings professional gravitas nonetheless.
He served as the presiding partner from 2013 to 2017 for New York-based Cravath, Swaine & Moore, historically one of the most prestigious, respected and profitable law firms in the nation. Parker had worked his way into that leadership role, starting as a Cravath associate in 1984 after graduating from Columbia Law School.
At Cravath, he looked up to a more senior firm lawyer, Rob Kindler, who is now Morgan Stanley’s vice chairman.
Kindler “taught me the importance of taking personal responsibility for all aspects of the transaction and never losing sight of those issues in the transaction that are truly important. Even nearly 30 years later, I find that these lessons are still the foundation of everything I do as a legal advisor,” Parker told a LawDragon interviewer in 2013 shortly after he had assumed the helm at Cravath.
Wells Fargo’s press release about Parker’s new assignment quoted him expressing admiration for the company’s employees but also stressing the temporariness of his new role.
“In my two years at Wells Fargo, I have been deeply impressed with the commitment of our 259,000 team members to move this great company forward and to build an even stronger foundation for the future,” Parker said.
“I am fully committed to this role as we continue the important work at hand in support of all our stakeholders, particularly our customers, and prepare for a smooth and effective transition to a permanent CEO,” he added.
Wells Fargo settled with federal regulators for $185 million in 2016 over revelations that thousands of employees in its retail banking unit opened millions of debit and credit accounts without client authorization, spurred on by aggressive sales targets.
Sloan had taken the helm in October 2016.
Since at least early 2018, the U.S. Justice Department and the SEC have been investigating sales practices at the company’s wealth management operations. In February the company revealed it was discussing "resolutions" with the government.
Additional reporting by Alex Padalka.