Bailed-Out Bank Nixes Lavish Vegas Junket

(CBS/AP)  Wells Fargo & Co. is canceling 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 after The Associated Press reported it had booked 12 nights at two of the city's most expensive hotels. But within hours, investigators and lawmakers on Capitol Hill had scorned the bank, and the company canceled.

The conference is a Wells Fargo tradition. Previous years have included all-expense-paid helicopter rides, wine tasting, horseback riding in Puerto Rico and a private Jimmy Buffett concert in the Bahamas for more than 1,000 employees and guests.

"I was amazed with just how lavish it was," said Debra Rickard, a former Wells Fargo mortgage employee from Colorado who attended the events regularly until she left the company in 2004. "We stayed in top hotels, the entertainment was just unbelievable, and there were awards - you got plaques or trophies."

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, has not.

"Recognition events are still part of our culture," spokeswoman Melissa Murray said Tuesday afternoon. "It's really important that our team members are still valued and recognized."

Corporate retreats have attracted criticism since the bank bailout last fall. Congress scolded insurance giant American International Group Inc. for spending $440,000 on spa treatments for executives just days after the company took $85 billion from taxpayers. AIG has since canceled all such outings.

The weekend of Feb. 25, Wells Fargo's insurance division was scheduled to host a 40-person team for a two-day meeting at the Mandalay Bay Hotel, according to the Las Vegas Convention and Visitors Authority.

Kevin Waetke, another spokesman for Wells Fargo, defended the trip, before it was cancelled. He said the company, which recently acquired Wachovia Corp., had a long-standing tradition of recognizing top employees.

"This year, we have the unique opportunity to bring together our Wells Fargo and new Wachovia mortgage consultants to focus on continuing to do all we can for U.S. homeowners," Waetke said.

In Washington, members of Congress disagreed.

"Let's get this straight: These guys are going to Vegas to roll the dice on the taxpayer dime?" said U.S. Rep. Shelley Moore Capito, a Republican who sits on the House Financial Services Committee. "They're tone deaf. It's outrageous."

In previous years, top Wells Fargo loan officers were treated to performances by Cher, Jay Leno and Huey Lewis. One year, the company provided fortune tellers and offered camel rides, Rickard said. Every night when employees returned to their rooms, there was a new gift on their pillows, she said.

Wells Fargo Chairman Richard Kovacevich has traditionally greeted every employee personally when they arrived.

Rooms at the Wynn and the Encore are consistently among the most expensive in Las Vegas. The $2.3 billion Encore opened in December. Its decor includes a 27-foot Asian dragon made from 90,000 Swarovski crystals and artwork by Colombian artist Fernando Botero. One of the restaurants features Frank Sinatra's 1953 Oscar.

Both properties have high-end retail stores, including Manolo Blahnik at Wynn and Chanel at Encore.

Morgan Stanley, another $25 billion bailout recipient, had been planning to send its top employees to a hotel in Monte Carlo this April. A Morgan Stanley travel agent said that the trip, along with a similar event in the Bahamas, was still on as of Tuesday afternoon. But company spokesman Jim Wiggins said employees were told Monday that the events were canceled. He said the travel agent was incorrect.

Bank of America, which recently purchased mortgage giant Countrywide and Wall Street financial house Merrill Lynch, said it has canceled all employee incentive trips.

"Given the current economic and business environment - and to further align our interests with those of our shareholders - we are making some difficult decisions to reduce or eliminate programs that do not directly impact our ability to serve our clients, customers and communities," Bank of America spokeswoman Kelly Sapp said in an e-mail.

[jetranger7]

Hey if my Company is in Trouble and they weren''t making a profit, which obviously WELLS FARGO must have some profit Problems, or they wouldn''t have got a BAILOUT or needed one, than theres a problem at the top and elsewhere, and if my company got a bailout, from the US TAX PAYER that does Not mean they have some Glorious right, to take that bailout money and MIS-SPEND it on Foolish things, if they want to reward their employees, than why not have a simple Party right their at their corporate offices for a few hoiurs and that be it, why do they need to spend hundreds of thousands of US Tax Payer Dollars on Lavish Vegas Hotel Rooms and Lavish Restraunts, WHY ? Because they can, and are Arrogrant and Corrupt ! Why would you reward that Company for not being a better Manager of that business, They asked for and needed a BAIL-OUT and got assistance ! If anybody else were in Financial trouble, and they''d pulled a stunt like this, we''d all be hearing about it, Ya, I need a large BAIL-OUT LOAN, so I can take my Family to Hawaii or Monte Carlo for a week on YOUR MONEY,, is that OK !!??????????

[rhs648]

A point missed by many posters is that the top 1% of sales people bring huge amounts to the company each year. They are not the salaried office help or the high paid executives. The executives are responsible for the business decisions. You have people who sell a lot and are profitable to a company (hence bonuses and sales conferences and executives who make business decisions and often earn bonuses. Those who make poor business decisions are the ones whose pay should be cut and bonuses eliminated. If a sales person is told a year in advance that if he reaches certain performance requirements to qualify for a sales conference, that promise should be kept. If your employer promises you company paid health insurance, you expect that promise to be kept. If your employer agrees to pay you $16.00 per hour, you expect that promise to be kept. The same is true for sales conferences that are promised a year or more in advance if you meet the sales requirements. Otherwise, you spent a year working for less than you were told you would receive. Commissioned sales jobs are not the same as salaried jobs or wage paying jobs. If you receive wages, you are paid for every hour you work. If you work overtime, you are guaranteed your wage plus overtime. Most salesmen are not paid for the hours they work. They are paid on the basis of making sales.

[xyno-2009]

Posted by perk235 at 03:40 PM : Feb 04, 2009

What happened to "no fun until the economy is back up"??

"Do as I say not as I do" only works on children.

[perk235]

how much fun did Obama and his supporters have spending $150 million of taxpayer money at his inauguration?
Posted by Xyno at 03:20 PM : Feb 04, 2009
-------------------

The same fun as most all of the other presidents, and definitely all of the presidents in the last 100 years. An added benefit was that this time the world was joining in the celebration.

[xyno-2009]

NO fun for anyone until the economy is back up-- A lot of us are not the scamming home owners or lenders but we still are taking the heat of what they did--so you WF employees need to **** and svck it up like the rest of us. NO Fun!! Got it?

Posted by harbinger09 at 02:50 PM : Feb 04, 2009

==================

LOL -- how much fun did Obama and his supporters have spending $150 million of taxpayer money at his inauguration?

[credibility2]

How much did this cancellation impact the local government with a loss in tax revenues? Would someone in the Las Vegas CVB please point this out in dollars and cents? Also, how much did Wynn lose by this cancellation and how many staff are they going to have to let go, or reduce their hours, to compensate for their losses because of this cancellation? I guess too many critics were obsessed with the extravagance of the junket, versus focusing on all of the aspects something like this involves.

[harbinger09]

ll the Liberal Press jumps on the Socialist bandwagon and attacks Wells Fargo for spending a little bit of its OWN MONEY to reward its employees for their performance. What the critics seem to ignore is that Wells Fargo was FORCED BY THE GOVERNMENT to take the $25 billion dollars, even though they did not need it. Also, Wells Fargo was never involved with high-risk loans which are at the center of the financial crisis.

What the Associated Press has done with their hit-piece yellow journalism is to attack one of the few financial institutions that has been playing by the rules all along, when others have been caught in all the wrongdoing.


Posted by CBSisPravda1 at 10:57 AM : Feb 04, 2009


**** liar. If Wells Fargo was really "FORCED" by the gov to take the loan, why didn''t they just take the 25 billion then a month later GIVE the entire 25 billion back? Because "Aw shucks, we don''t wanna, but gee--we guess we will take all that money and play with it?

Try that somewhere else. No one forces anyone to take money and no one forced WF to spend it. You must be a WF employee. Hate your trip being canceled? Tuff titttties, if WF is doing the trips on their own dime and did not need the bailout money because they were so healthy--then they can just return OUR 25 billion today--or is that the money the used to leverage their buying of Wachovia? LOL

[jxknowles]

Don''t these people have jobs? We gave them a loan so they could keep their jobs. Do them! Make money and start paying us back, with interest.

[bpb58]

Maybe it''s time for someone to report on how CBS rewards their top performers. I seriously doubt they get a certificate or double-up in motel rooms at the Motel 6.

[harbinger09]

You''''''''re missing the point. IT IS OUR TAX MONEY THAT IS PAYING FOR IT!!"

Get a grip...think for yourself for just a minute and do some research. You''''ll find that WF are repaying YOUR $25B they were forced to take by the government. No other bank has paid us taxpayers back. When are we going to let business get on with their business?

The truth is out there.

Posted by lovekellydog at 02:02 PM : Feb 04, 2009


NO fun for anyone until the economy is back up-- A lot of us are not the scamming home owners or lenders but we still are taking the heat of what they did--so you WF employees need to **** and svck it up like the rest of us. NO Fun!! Got it?

Sweat, be frustrated, be scared for your jobs, cut back and keep working (if you still have a job) because no matter how you try to portray and swing it--taking great vacations on the public dime, while everyone else is cutting their spending, healthcare and food is BS and we will GUT whichever companies keep doing it. As for the 375 million WF is giving back, that is not even 1/2 of 1 of the Billions they received. GEt back to us, when all you still OWE us back it 375 million, then, maybe we will understand your pain and cut you a break. Until then, FVCK YOU and WF.