BizWorthy: Wells Fargo Names A New CEO; Millionaires Dispute Mansions

Oct 3, 2019

Wells Fargo named its new CEO last week. Charles Scharf, who was the head of Bank of New York Mellon, has a long Wall Street resume. The job he’s inheriting comes with a lot of political scrutiny as the bank continues to try to clear its name after it emerged that employees opened millions of fraudulent accounts to meet high pressure sales goals. The Charlotte Ledger’s Tony Mecia joins us now in the week’s BizWorthy segment. 

Lisa Worf: So Scharf has a tough job ahead of him. Tell us about Scharf.

Tony Mecia: Sure. So Scharf was named to the post last week after a long search that went on for about six months. Initially the thinking had been that Wells Fargo might be looking to sort of break the mold a little bit and who they put into that job, maybe hire a woman. They certainly wanted an outsider but this seems to be a little bit more of a traditional type of pick in the sense that he's very familiar with Wall Street. His background is in banking. He ran Visa for a number of years. He was with Bank of New York Mellon. He has sort of that traditional pedigree that bankers have -- nothing wrong with that, but there's a lot of political scrutiny that comes to it. And one of the complaints on Capitol Hill that lawmakers have had against Wells Fargo is that they put these sort of insider banker guys in there who aren't maybe as responsive to the community who haven't done a good job of taking care of some of the problems that Wells Fargo has had. And so that's been some of the complaints you might hear some more of those complaints coming from politicians in Washington.

Worf: It sounds like he got a pretty good salary boost from his past job for this, too.

Mecia: He did he got about a 40% premium on what he was making at Bank of New York Mellon. His pay package is targeted at about $23 million a year for Wells Fargo. That's been another source of concern among lawmakers is that Wells Fargo is paying these guys too much. It's certainly very competitive with a lot of the peer institutions, with a lot of other financial institutions. So it's not necessarily out of line with what people make in that industry but it certainly is a big number that attracts a lot of attention.

Worf: Now he's going to remain based in New York. How shall we take that here in Charlotte? And how should they take that in San Francisco where Wells is based?

Mecia: Yeah. You know, the big question in Charlotte is what does this mean for Charlotte what is naming this guy mean for Charlotte? And when people ask that they usually mean does this mean we're going to get the headquarters moved here? That's what everybody would really like to see is this job creation here and the headquarters moved here. It's obviously premature to know what's going to happen with that. It is kind of interesting that he's gonna be based in New York running a San Francisco company. And San Francisco I think is a little concerned about that in terms of what does that mean for the future of the headquarters in San Francisco especially given that San Francisco tends to be a higher cost place to do businessm, to hire people, real estate costs are through the roof. On the other hand, you know it's not uncommon for people in the financial services to be based in different places. It's a national-international type job where being based in New York maybe has some of its advantages and he makes the point, 'Well I'm going to be going around all the places that are important -- San Francisco, Charlotte, Minneapolis.' So it doesn't necessarily indicate a headquarters move is imminent.

Worf: Charlotte moved up this week in an important ranking -- Nielsen's measure of the size of TV markets. We jumped from 23 to 21. What's so significant about this?

Mecia: It doesn't sound significant on its face. You know there are a lot of these rankings that come out that often place Charlotte and you know in the 20s or 30s in terms of its size or or all sorts of different things. Best places to raise your dog, or something like that. This is actually a little bit more significant in the sense that if Charlotte is able to crack the top 20 markets, that unlocks a bunch of advertising dollars from networks. That there's a lot more attention paid to top 20 markets in terms of advertising not just on local TV stations but radio stations, on buses, billboards -- that they really want to get the eyeballs of people in those top-20 markets and we're almost there.

Worf: OK. So you describe this next story as 'juicy millionaire dispute' at Quail Hollow. It's between former Congressman Robert Pittenger and Lending Tree CEO Doug Lebda. What have you learned about how millionaires handle mansion disputes from this?

The Lebda home, top, is seen in a February 2019 Google Street View capture and the Pittenger home is seen in a photo from Mecklenburg County property records.
Credit GOOGLE MAPS/MECKLENBURG COUNTY

Mecia: So this is a dispute that's been going on for a little over a year in the courts. Robert Pittenger, the former congressman, has a 10,000-square foot, $5.1 million house at Quail Hollow near the 15th hole tee box and his next door neighbor is Doug Lebda, who just finished construction on a 15,000-square foot, $4.1-million dollar house. Now they're next door neighbors. But there's been a dispute. Pittenger sued Lebda last year over the size of the house. He said it was too big. He said it was encroaching on the setback. It was within a 10-foot setback. He had other complaints about the house -- that it was a nuisance and not appropriate for the neighborhood. If you look at the photos, Lebda's house does sort of overlook Pittenger's pool. So Pittenger sued both Lebda and the neighborhood association. He's saying he's unable to sell his house at a reasonable price because of what Lebda has done. A few more details came out this week about the background of that, how the two met face-to-face at Quail Hollow to try to resolve it before the lawsuit was filed. Lebda says that Pittenger asked him for $1-2 million dollars to make the problem go away.

Worf: That didn't go over well.

Mecia: That didn't go over well. Lebda is one of the highest-paid CEOs in the country, but balked at paying $1-2 million to Pittenger to make the problem go away. So they've been battling it out in court. And I think what it shows is that, you know, money can buy a lot of things, it can buy you a $4.1 million dollar, 15,000-square foot house with a five car garage -- but it can't necessarily buy peace and harmony with your next door neighbor.