20 Years Later: This month marks 20 years since the infamous "Boom-Boom Room" lawsuit, and while conditions have improved in some ways for women on Wall Street, there's far to go to achieve true gender equality. "You may no longer have strippers coming for afternoon entertainment, but that doesn't mean you are treated as an equal," said Anne C. Vladeck of the New York employment law firm Vladeck, Raskin & Clark. "It's not quite as blatant as what went on in the boom-boom room, but it's still there in a way that makes it very hard for women to succeed. Companies on Wall Street are just not changing." Smith Barney paid $150 million to settle the "Boom-Boom Room" class action initially brought by 23 female employees claiming rampant sexual harassment and pay discrimination in 1996. About 2,000 more women joined the case to bring light to the industry's testosterone-driven culture. More women are joining banks' senior ranks today, but there's still an undeniable gender imbalance at the top and complaints remain about pay and promotion disparities and ability to seek damages in court.
Staffing Up for a Contrarian Branch Strategy: While many other banks are trimming branches, Union Savings Bank in Danbury, Conn., is adding staff at its underperforming ones instead. Cynthia Merkle, president and chief executive, said the strategy began with an effort to turn around "a beautiful branch" in Monroe, Conn., that was severely underperforming. "I guess we believed if we built it, customers would come," she said. "But they didn't." Union created and deployed a solutions team to work in the branch. The team — which included a mortgage and commercial lender, along with treasury and wealth management officers — operates autonomously with minimal interference from upper management and works closely with the branch staff to improve cross-selling. The results of this pilot were so good that Union Savings has now set up solutions teams at two other branches.
Community Building: As part of a new community ambassador program, Bank of the West is loaning some of its star employees to local nonprofit organizations for one year. Jenny Flores, the head of community affairs, said the program aims to deepen ties with the community, give the bank insight into how it can better serve nonprofits and provide employees with growth opportunities. She described the program as a form of leadership training, saying it grooms top performers for executive roles and provides the bank with a retention tool for values-oriented employees. The bank also receives Community Reinvestment Act credit for the program.
Follow the Money: In a hearing Tuesday, Jennifer Shasky Calvery, the director of the Financial Crimes Enforcement Network, defended the beneficial ownership rule that the Treasury released earlier this month. It was her final congressional appearance before she leaves her post this week. Calvery said the rule, which requires that banks demand the identities of main principals behind companies seeking to open a bank account, will be critical for rooting out money laundering and terrorist financing. The rule targets shareholders with a stake of more than 25% plus one mandatory person involved in the firm's operations. At least one lawmaker questioned why the government would require banks to get such information rather than simply relying on the IRS.
Overturned: It's rare that individual employees are charged with financial crimes at the investment banks, the Wall Street Journal found. One of the few successful government cases was overturned this week, when a federal appeals court did not uphold civil mortgage-fraud charges and a $1 million penalty against Rebecca Mairone, a former executive at Countrywide Financial Corp., which was later acquired by Bank of America. The WSJ analyzed 156 criminal and civil cases brought by U.S. regulators against 10 large Wall Street banks since 2009. A total 47 bank employees were charged in relation to their cases (just one was a boardroom-level executive); 24 of them settled or pleaded guilty, 11 contested the charges, five were found liable.
Home Is Where Women Lose Again: Homes owned by single men are more valuable and appreciate faster than properties owned by single women, according to a new RealtyTrac study. On average, the home value gender gap for single homeowners is $26,132, or 10%. Blame the fact that women earn less, so don't have the same purchasing power as men when buying a home. This is having a domino effect that hinders their ability to build wealth as quickly as single men.
Role Call
Fulton Financial in Lancaster, Pa., has hired Lynn Ozer as president of Small Business Administration lending. Ozer was part of a team at Susquehanna Bancshares that was largely dismissed last summer after the company's sale to BB&T.
Beyond Banking
Referendum Reps: There should be more women involved in broadcasted debates on Brexit, said Harriet Harman, the U.K. Labor party's former deputy leader. "Half the population of this country are women and our membership of the EU is important to women's lives," Harman, 65, said in a letter to broadcast regulator Ofcom. "Yet men are — as usual — pushing women out. This referendum is too important to be left to men." The leading figures on each side are Prime Minister David Cameron and Chancellor of the Exchequer George Osborne (on the "remain" side) and Justice Secretary Michael Gove and former London Mayor Boris Johnson (on the "leave" side).
What to Wear: Given several recent high-profile scrums over office attire — including one where a PwC receptionist was sent home for not wearing high heels — a new exhibition by the Museum at the Fashion Institute of Technology on uniforms is timely. "If once upon a time Melanie Griffith's character in 'Working Girl' could manipulate viewers' assumptions about her job and background simply by swapping leather jackets and mini-dresses for greige suits, today it would be impossible," contends this article in the New York Times, which makes the case that dress codes going out of fashion is a positive for gender equality. Susan Scafidi, a law professor at Fordham University and founder of the Fashion Law Institute, said a dramatic change is taking place in society. "We are moving into an era where personal expression is going to trump the desire to create a corporate identity," Professor Scafidi said. "It's a huge power shift."
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Check out our Women in Banking page and join our LinkedIn group. (You can find the group by doing a search for "American Banker — Women in Banking" on LinkedIn.)
Bonnie McGeer contributed to this report.
