Yesterday's big "thumb your nose at the public, the politicians, and the pundits" story was about Wells Fargo's employee reward trip to Las Vegas.
Within a couple of hours after AP dimed Wells Fargo with a report that said:
Wells Fargo, which received $25 billion in taxpayer money, has booked 12 nights at the Wynn and Encore hotels starting Friday. Some of that is for a company conference honoring the top mortgage lenders.
Wells Fargo said they had scaled back and were reconsidering the event.
Within a couple of hours of that, MSNBC reported that the event had been canceled.
When I worked at Genuity, I got to go on one of these rewards vacations, so I have a pretty good understanding of how lavish they can be. I posted about this last fall when AIG got it in the neck for going ahead with a $442K employee "retreat" - just before they got a $85B loan from the Feds.
In the world we live in - dismal economy and 24/7 media (amateur and professional) willing to jump on anything they think that people will get riled up about - it's amazing to me that Wells Fargo thought they could get away with this. (Frosting on this particular cake: the event was apparently a reward for their highest performing mortgage lenders. Now's not the time to give a big, fat trip to the Wynn Hotel to someone who worked in the m-word group. How could they possibly be thinking that they were going to get away with it.)
Yes, it is completely, fundamentally, supremely tone deaf for a company on the receiving end of TARP money to jaunt off to Vegas to celebrate last year's success. Talk about a sub-prime use of TARP money!
But, in truth, these events are planned so far in advance, I would bet that, by this point, most if not all of the hotel room costs and food expenses for the communal events has already been paid. If they were having big-name entertainment - and in the past, they've had Cher, Jay Leno, and Huey Lewis - that's been fully paid up, too. So have the costs for the polo shirts, golf umbrellas, revere bowls, tote bags, digital cameras, and every other piece of swag that they were going to bestow on attendees. (I'm guessing that those disappointed attendees will at least get their swag bags.)
What would have been left - or refundable - would be travel costs, reimbursement for your-on-your-own dinners, and a few other sundries.
The big bucks are sunk - and I'm doubtful that the Wynn Hotel is going to provide a refund.
But Wells Fargo has canceled, but the reputation and common sense damage has been done.
So, what could Wells Fargo have done here that would have made them look good?
They could have canceled the reward trip before it became a public hoop-de-doo.
Yes, this would have disappointed those who truly feel they deserved their reward, even if it was for closing 125% of their quota for sub-prime loans that turned out to be non-performing. Oops. But these are grown ups, who presumably would understand why the trip has been canceled. And Wells Fargo could have thrown them a bone: more vacation days (they can't be doing much business this year anyway); maybe a small bonus check; maybe a $250 take-your-spouse-out-to-a-nice-dinner American Express gift card.
Then they could have contacted some charities and said, hey, we've got some nice paid for rooms in the Wynn that you might want to raffle off.
Wells Fargo wouldn't have gotten their money back. But they would look like they had a clue. Given the national mood and the reality that they needed a big, whomping bailout, you'd think they could have figured this one out before the damage was done to whatever shred of a reputation they still have.
Oh, oh, the Wells Fargo wagon is a comin' now.
I don't know how I can ever wait to see.
It could be something for someone who is no relation,
Or it could be, something special, just for me.
What's a matter? You don't know every word to every song in The Music Man? What's wrong with you?