(Adds Wells Fargo comment)
By Hilary Russ
Oct 18 The state of Massachusetts will stop
using Wells Fargo & Co as a bond underwriter for a year,
joining a growing list of state and local governments to suspend
business with the bank after revelations it opened millions of
Massachusetts Treasurer Deborah Goldberg instructed her
staff late on Monday to immediately remove Wells Fargo from the
state's approved list of underwriters for a term of one year,
her spokeswoman said on Tuesday.
Compared with other states, Massachusetts' exposure to the
bank is "extremely limited," but Goldberg "isn't convinced that
Wells Fargo has grasped the level of seriousness of their
actions nor have they addressed systemic failures within their
organization," spokeswoman Chandra Allard said in an email.
"We value the Commonwealth of Massachusetts' business and
will work to earn it back," the bank said in a statement.
Last month, Wells Fargo agreed to pay a $190 million
settlement over its staff opening as many as 2 million accounts
without customers' knowledge. The misconduct triggered a raft of
federal and state investigations and led to the resignation last
week of its chief executive and chairman, John Stumpf.
Earlier this month following the scandal, Massachusetts, as
well as Oregon and the city of New York, said they were
reviewing their business relationships with the firm.
The backlash has since widened. On Friday, Ohio said it
would ban state business with Wells Fargo for a year, following
the city of Chicago and the states of Illinois and California.
In Massachusetts, the bank said, it employs 1,300 people and
contributed $1.3 million to nonprofits and schools statewide in
Its business with the state is conducted through Wells Fargo
Securities, which is a separate business line from its retail
(Reporting by Hilary Russ; editing by Meredith Mazzilli and