Wells Fargo has built up a significant lobbying presence in state capitals to manage the torrent of mortgage-related bills flooding legislatures.
Five years ago, the San Francisco bank reported a limited state lobbying presence focused on the West Coast and Iowa. After becoming a national bank, Wells Fargo now has lobbyists bending state legislators ears everywhere from Denver to Baton Rouge, La.
It has built its East Coast lobbying presence beyond that of Wachovia, the Charlotte bank Wells acquired in 2008. The bank also has spent more money on lobbying in states including California and Minnesota, courted city mayors, and sought more government business.
The bank registered more than 150 lobbyists in 31 state capitals in 2012, according to an Observer review of state lobbyist registration rolls. Thats an increase from the 47 in 10 states it had five years ago or 60 in 14 states if you add in Wachovias lobbyists.
Wells Fargo says the increase is largely tied to evolving rules on who must register as a lobbyist. About half of U.S. states require people who seek government contracts to put their names down.
The bank also says that while it may have more contracted lobbyists registered under its name, Wells in-house government relations team hasnt grown.
But in at least 11 states, Wells has registered lobbyists to influence legislation where neither it nor Wachovia had voices five years ago, the Observers analysis found.
The growth is yet another example of the pre-eminent position the bank has taken in the financial industry, particularly in mortgage lending and servicing, as rivals have pulled back. Charlotte-based Bank of America has pared its state lobbyist registrations by about a quarter, to 136, the Observers data shows.
At the federal level, Wells Fargo is again the top commercial bank lobbying spender, with $3.8 million spent in the first half of the year, according to data from the Center for Responsive Politics. Last year, Wells Fargo led the industry to a record-high level of lobbying spending.
Wells Fargo has also aimed its message at mayors. The bank has hosted four gatherings of city executives in recent months most recently last week in Charlotte, where the bank showed a group of mayors around its housing preservation workshop.
But since the real estate meltdown, statehouses have been a hotbed for banking bills especially since 49 state attorneys general reached a $25 billion settlement this year with Wells Fargo, Bank of America and three other big banks over shoddy mortgage servicing practices.
The American Bankers Association is tracking more than 200 statehouse bills on topics ranging from foreclosure rules to homeowners rights to mortgage fraud, said Mathew Street, deputy general counsel for state relations.
California and other states have created forms of a Homeowners Bill of Rights, while Arizona and Hawaii considered bills that would allow governments to use eminent domain powers to seize troubled mortgages.
Its not inherently bad to increase the number of lobbyists, said Peggy Kerns, director of the ethics center at the National Conference of State Legislatures. If there are certain policy issues that are being taken up, that happens. The number of lobbyists ebbs and flows based on what the issues are.