By Daniel Wagner and Matt Apuzzo
Wednesday, February 4, 2009
Wells Fargo yesterday canceled a pricey Las Vegas casino junket for employees after a torrent of criticism that it was misusing $25 billion in taxpayer bailout money.
The company initially defended the trip. It had booked 12 nights beginning Friday at the Wynn Las Vegas and the Encore Las Vegas. After investigators and lawmakers on Capitol Hill scorned the bank, the company canceled.
The conference is a Wells Fargo tradition. Previous all-expense-paid trips have included helicopter rides, wine tasting, horseback riding in Puerto Rico and a private Jimmy Buffett concert in the Bahamas.
"In light of the current environment, we have now decided to cancel this event as well," the company said in a news release that also said it had never planned to use taxpayer bailout money for the trip.
Corporate retreats have attracted criticism since the bank bailout last fall. Congress scolded insurance giant American International Group for spending $440,000 on spa treatments for executives just days after the company took an $85 billion loan from taxpayers.
Because of the bailout and the recession, other banks have canceled employee outings, including Morgan Stanley, which informed employees Monday that an appreciation trip to Monte Carlo was off.
Wells Fargo, however, had not. And initially, the company indicated it had no plans to cancel.
"Recognition events are still part of our culture," spokeswoman Melissa Murray said. "It's really important that our team members are still valued and recognized."
Kevin Waetke, another spokesman for Wells Fargo, said the Las Vegas trip provided a "unique opportunity" for Wells Fargo employees and employees of newly acquired bank Wachovia, "to focus on continuing to do all we can for U.S. homeowners."
On Capitol Hill, lawmakers disagreed.
"Let's get this straight: These guys are going to Vegas to roll the dice on the taxpayer dime?" said Rep. Shelley Moore Capito (R-W.Va.), who sits on the House Financial Services Committee. "They're tone deaf. It's outrageous."
The trip was to come on the heels of this week's announcement that Wells Fargo lost more than $2.3 billion in the last three months of 2008.