Wells Fargo has announced the hire of a new chief compliance officer as it distances itself from its fake account scandal, which has drawn repeated congressional hearings this year and forced a spate of resignations and turnover in the executive suite.
Michael Roemer will takeover in January as the new chief compliance officer, based out of San Francisco, and will report to the bank’s chief risk officer. His role will be to “ensure that all areas of the company meet compliance management responsibilities and abide by all applicable laws and regulations,” according to a press release announcing his hire.
Roemer joins from Barclays, whose CEO is reported to be under federal investigation for alleged attempts to unmask the identity of an whistleblower. Before that, he held the title of chief auditor at CIT Group and helped establish the Compliance Career Academy at the Judge Business School at Cambridge University in the U.K., where he was based at Barclays, according to his bio.
Roemer, who holds a BS degree in accounting and joined Barclays in 2012 as head of internal audit, was not available for comment. A source at Barclays said his departure was unrelated to any ongoing investigation.
At Wells Fargo, he replaces Yvette Hollingsworth who had served as chief compliance officer of Wells Fargo since 2012, and in June, took a new title as regulatory innovation officer under which she will help the company look at risks of new products. Like Roemer, she had also joined the company from Barclays, where she was a managing director.
In a written statement, Barclays’ CEO Jes Staley praised Roemer for helping guide his bank through the LIBOR scandal, in which it paid $100 million in 2016 to settle probes in 44 states — on top of a $453 million federal settlement reached in 2012 — for its alleged role manipulating LIBOR, or the interbank loan rate used to set borrowing rates.
“He was instrumental in supporting the cultural transformation of Barclays subsequent to the LIBOR settlement,” Staley said in the statement.
Roemer also served as Barclays’ co-chair of the executive diversity and inclusion committee, and Wells Fargo described him as a champion for the LGBT community in a press release.
At Wells Fargo, he enters a bank that is still dealing with the fallout from a scandal that came to light one year ago, in which employees created as many as an estimated 3.5 million unauthorized bank accounts in customers’ names in order to meet sales targets, according to statements that the bank has made. On Tuesday, California’s state treasurer John Chiang extended a ban on the bank from underwriting any of its municipal bond offerings, citing ongoing ethical concerns.
Meanwhile, earlier this month, the bank’s CEO Tim Sloan and general counsel Allen Parker, the former chairman of Cravath, Swaine & Moore — both of whom started their positions after the scandal surfaced — traveled to Washington, D.C. for a Senate Banking Committee hearing on the changes being made at the bank.
Senator Elizabeth Warren, D-Mass., who last year successfully called for the resignation of Sloan’s predecessor John Stumpf, is now demanding Sloan’s resignation, noting he was chief financial officer previously, and accusing him of enabling and profiting from the scandal.
In April, the bank released a report written by Shearman & Sterling that laid into the legal department for focusing on cost containment rather than more fully investigating the roots of the fake account scandal.
Barclays said Laura Padvoni, head of compliance services, will replace Roemer as interim chief compliance officer while it conducts an internal and external search for a permanent replacement. Padvoni previously eported to Roemer, who reported to the chief risk officer.
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