It’s been quite a while since former Deloitte Global CEO Jim Quigley graced the hallowed pages of Going Concern, not since 2015 when Quigs was quoted in the Wall Street Journal for saying how much he absolutely loves being on an audit committee.
Let’s refresh your memory:
Some directors remain unfazed by the heavy workload because they enjoy being where the action is. “It’s where you have a very broad access to management time and information about the business,” says James Quigley, audit committee chairman for Wells Fargo & Co.
Well, unfortunately for JQ, he no longer is chairman of his beloved Wells Fargo audit committee, or a member of Wells Fargo’s board of directors.
The Washington Post reported earlier today:
Wells Fargo announced Monday that two of its board members, including its chairwoman, Elizabeth A. Duke, have resigned, following a scathing House report found that the bank’s leaders were slow to address a series of consumer abuse scandals.
Duke and board member James Quigley were both featured in a more than 100-page report by the House Financial Services Committee that cited thousands of pages of documents, emails and internal notes to conclude the San Francisco-based bank had not properly addressed its problems.
Among the country’s largest and most profitable banks, Wells Fargo has struggled to overcome a fake-accounts scandal, which ballooned as the bank admitted to other consumer abuses, including mistakenly foreclosing on hundreds of clients and repossessing the cars of thousands of others.
Bad press and Wells Fargo have gone hand-in-hand for a while now. Just two weeks ago, WF was fined $35 million by the SEC for failing to supervise investment advisers who were recommending high-risk products to clients.
Reuters reported on Feb. 27:
Wells Fargo Clearing Services and Wells Fargo Advisors Financial Network failed to supervise investment advisers who recommended single-inverse exchange-traded funds (ETFs). The advisers recommended the investments to customers with conservative or moderate risk tolerances, including senior citizens and retirees, the SEC said in a filing.
Quigley and Duke were supposed to appear before the House Financial Services Committee on Wednesday, when the findings of the panel’s report were to be discussed, but instead of getting their asses chewed up and spit out by committee chair Rep. Maxine Waters (D-CA), the two released this joint statement today:
“Since we were made aware of the egregious harms suffered by Wells Fargo’s customers, we were and remain fiercely determined to do right by them and to strengthen the bank’s culture and controls. We have made these our top priorities. In addition, we hired new external leadership with the ability to be an effective change-agent, which we found with our CEO, Charlie Scharf. As the markets face increasing volatility, a strong Wells Fargo is needed now more than ever. Out of continued loyalty to Wells Fargo and ongoing commitment to serve our customers and employees, we recommended to our colleagues on the Board that we step down from our leadership roles and they have accepted our resignation from the Board. We believe that our decision will facilitate the bank’s and the new CEO’s ability to turn the page and avoid distraction that could impede the bank’s future progress.”
Both of their resignations were effective yesterday.
The report contains not-so-great interactions that Duke and Quigley had with regulators, according to the Washington Post. There’s one cited between Duke, then vice chair of Wells Fargo’s board, and the Consumer Financial Protection Bureau from 2017. Here’s one involving Quigley:
In another exchange, James Quigley, also a board member, resisted attending a meeting with one of the bank’s regulators because he was overseas on vacation. “I am currently scheduled to be in the Galápagos Islands on these dates,” he said in a 2019 email, according to the report. “The sense of urgency is surprising, are they politically trying to put an enforcement action in place in front of the hearing?”
At least Jimbo doesn’t have to worry about such urgent Wells Fargo matters anymore. He can now concentrate on being CEO emeritus of Deloitte, which has got to be grueling work.
You may have heard of the new chair of Wells Fargo’s board. It’s Charles Noski, who joined the board last June and is a former chairman of the Financial Accounting Foundation board of trustees.
Wells Fargo board members resign after scathing House report [Washington Post]