Wells Fargo & Co. has appointed Douglas Edwards to serve as acting legal chief and a member of the bank’s operating committee.
Edward’s promotion from interim general counsel came two weeks before Wells Fargo finalized a $3 billion settlement with the Justice Department and Securities and Exchange Commission related to alleged consumer banking abuses at the financial services giant.
His promotion would require approval of the Office of the Comptroller of the Currency (OCC) under the terms of a 2018 consent order in which the federal banking regulator was given input on the selection of Wells Fargo senior executives and board members.
An OCC spokesman said the agency would not comment on specific individuals. Two lawyers who have worked in-house at Wells Fargo within the past year told Bloomberg Law that the OCC has taken an active role in monitoring law department developments at the company, with chief bank examiner Tanya Smith addressing an off-site gathering of hundreds of bank lawyers last year in Salt Lake City.
Smith did not return a request for comment about whether the OCC is providing input in the selection process for a new general counsel, nor did the regulator’s chief counsel and senior deputy comptroller Jonathan Gould.
A Wells Fargo spokesman confirmed to Bloomberg Law that C. Allen Parker, a former general counsel-turned-interim CEO for the San Francisco-based bank who announced his plans to leave the company late last year, stepped down from his day-to-day legal responsibilities Feb. 7.
On that date Edwards, a former longtime deputy general counsel at Wells Fargo who was named interim general counsel in November, took over leadership of the company’s law department as acting general counsel.
Wells Fargo spokesman Peter Gilchrist said as acting legal chief, Edwards will serve as a member of the bank’s operating committee “until a new general counsel starts with the company.” Gilchrist declined to discuss a timeline for selecting Parker’s permanent replacement.
Gilchrist noted that Parker remains a member of Wells Fargo’s legal department and “will be available to assist the company” through the end of March. Parker, a former presiding partner at Cravath, Swaine & Moore in New York, joined Wells Fargo as its general counsel three years ago this month as the bank grappled with the fallout from an unauthorized accounts scandal.
In March 2019, Parker took over as interim CEO at Wells Fargo following the resignation of Tim Sloan. In October, Parker gave up that title after the company hired former Visa Inc. CEO Charles Scharf as its new leader.
Bloomberg Law reported in January that Wells Fargo’s process for picking a permanent general counsel had led it to check in with some of the nation’s top financial regulatory lawyers and move away from selecting as a successor Edwards, a well-regarded law department veteran who has worked at the bank since its $15.1 billion merger with Wachovia Corp. in December 2008.
In late January, the OCC hit eight former Wells Fargo executives—including Edwards’ former boss, ex-general counsel James Strother—with a combined $59 million in fines as a result of “massive illegal activity and catastrophic reputational damage” stemming from the company’s retail banking woes, according to documents released by financial regulator.
The bank itself agreed to pay a $1 billion fine in a 2018 consent order with the OCC. That settlement also gave the agency the authority to remove or suggest changes to Wells Fargo’s senior executives and board members.
An OCC spokesman told Bloomberg Law that per the 2018 consent order, Wells Fargo “shall obtain a prior written determination of no supervisory objection from the Deputy Comptroller with respect to the appointment of any individual to a position of ‘senior executive officer,’ or to the appointment of Chairman of the Board or any other individual to the Board.”
The role of senior executive officer includes all Wells Fargo employees that are part of its operating committee—such as Edwards—and any potential future employees that the company may add to its operating committee, according to the OCC.
Wells Fargo’s Gilchrist deferred to the OCC and the bank’s 2018 consent order when asked whether the regulatory clearance protocols had extended its own internal process for picking Parker’s permanent replacement.