Wells Fargo cancels Vegas event
The bank, which received bank bailout funds, faces criticism for booking expensive Las Vegas hotels for an employee conference.
NEW YORK (CNN) -- Wells Fargo announced Tuesday it would cancel a four-day business meeting in Las Vegas, Nevada, after news reports tagged it a "pricey Las Vegas casino junket."
The company, one of nine banks to receive funds from the first round of government bailout money last fall, called the reports "intentionally misleading."
"The event is not a 'junket' for executives but a four-day business meeting and recognition event for hard-working team members who made homeownership achievable and sustainable for borrowers across the nation," the company said in a statement.
Citing an Associated Press story, CNN reported that Wells Fargo had booked 12 nights at two of the city's most expensive hotels, drawing questions and criticism from Capitol Hill on whether the bank, the recipient of $25 billion from the Treasury's bailout plan, misused taxpayer money.
"The question here is whether Wells Fargo is spending taxpayer money to bankroll Las Vegas junkets," New York Attorney General Andrew Cuomo told Bloomberg News in an e-mailed statement. "That is an answer the American people deserve to know because this is their money."
But Wells Fargo refuted the allegations in a written statement, saying that the AP report "misleads readers by implying Wells Fargo used the government's investment to pay for these events. We've used the government's investment to lend to creditworthy customers and to help homeowners avoid foreclosure."
Bloomberg reported that Wells Fargo added $9.7 billion in loans in the fourth quarter, compared with a combined $86.4 billion decline at JPMorgan Chase (JPM, Fortune 500), Bank of America and Citigroup. The company has also said it does not need any further bailout funds, while Citigroup (C, Fortune 500) and Bank of America received additional funds.
Wells told CNN that it had decided late last year to cancel such recognition events for 2009 "except those where the financial commitment was so great that no meaningful savings would occur by canceling [them], but in light of the current environment, we have now decided to cancel this event as well."
This comes on the heels of an ABC report that accused Bank of America of allegedly spending $10 million on a "five-day carnival-like" Super Bowl party and Morgan Stanley of planning an "elegant gathering" at a five-star resort in Florida.
Bank of America (BAC, Fortune 500) called the ABC report "inaccurate." The bank said that it does not use federal bailout money to support its corporate activities, but that such activities help the bank "generate earnings and fulfill our obligations to shareholders, including the U.S. taxpayer."
For its part, Morgan Stanley (MS, Fortune 500) addressed the ABC account as "misguided" and said the event was an annual conference for clients who do business with Morgan Stanley where clients pay for their own accommodations and travel.