Banking On Lobbying

Few lawyers have traveled the GC circuit quite as much as Christine Edwards. Since 1997 she's put in two controversy-plagued years at Morgan Stanley (as the first female GC on Wall Street), then a quick nine months at ABN Amro North America, and now she's leaving Bank One Corporation, after three years. This time, however, she isn't moving on to another top legal job in the financial industry. Instead, Edwards is returning to what she says is her real passion: lobbying.

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Few lawyers have traveled the GC circuit quite as much as Christine Edwards. Since 1997 she’s put in two controversy-plagued years at Morgan Stanley (as the first female GC on Wall Street), then a quick nine months at ABN Amro North America, and now she’s leaving Bank One Corporation, after three years. This time, however, she isn’t moving on to another top legal job in the financial industry. Instead, Edwards is returning to what she says is her real passion: lobbying. Her replacement at Bank One � Joan Guggenheimer, the former co�GC at Citigroup Inc. � comes as little surprise. Ever since Citigroup exile Jamie Dimon became CEO of Bank One in 2000, he’s brought along several of his former colleagues. They include Michael Cavanaugh, now Bank One’s strategy officer, and Heidi Miller, its current chief financial officer (as well as her predecessor in the post, Charles Scharf). Edwards, 50, says she will go back to her roots in lobbying for financial services firms, focusing on class action reform and corporate governance. “My real love and passion has always been public policy,” says the attorney, who got her start as a lobbyist for Sears, Roebuck and Co. “You never quite get that out of your system once you’ve done that for a while.” She’s already signed up three clients, including Bank One, and is still deciding whether to start her own consulting practice or join a national law firm. Tripped Up By Curry Fiasco Indeed, being a GC is something that Edwards seems to have stumbled into. While working at Sears, Edwards went to law school at night, getting her degree from the University of Maryland in 1983. Only five years later she landed her first GC position, at the business unit of Discover Card; two years later she took over the law department for parent company Dean Witter Discover & Co. CEO Philip Purcell admired her work, and when the company merged with Morgan Stanley, he chose Edwards as the new business’s general counsel. But the job quickly turned into more than Edwards had expected. In 1998 Morgan Stanley was hit with a wrongful termination suit from former analyst Christian Curry, a case that soon turned into a nightmare for the bank. The nadir came when court documents revealed that Morgan Stanley litigation chief Monroe Sonnenborn had paid $10,000 to an informant to implicate Curry in a fraudulent e-mail scheme. According to Manhattan prosecutors, Edwards didn’t know about the payment � which had been okayed by the bank’s outside counsel at Davis Polk & Wardwell � until hours before it was made. A special investigation by Paul, Weiss, Rifkind, Wharton & Garrison cleared Edwards of wrongdoing, but nonetheless she resigned in 1999 under pressure. In a statement issued at the time, Purcell and Morgan Stanley president John Mack said, “Chris expressed the view that ‘this matter happened on my watch.’” Later that same year, Edwards joined the North American division of Netherlands-based ABN Amro Bank N.V. bank, but only stayed a few months. Cleaning Up Bank One’s Legal Mess Two months after Dimon took over as CEO of Bank One in 2000, he hired Edwards as GC. The company was reeling from a series of badly integrated acquisitions, regulatory trouble with its capital markets divisions, and a string of earnings disappointments. Plus, it was tussling with then-senator Phil Gramm, NASD, government regulators, and class action plaintiffs over issues involving Bank One’s credit card unit, which had been accused of posting payments late, charging too many late fees, and arbitrarily raising rates. Edwards was charged with cleaning up the legal mess. “When I joined Bank One, it was a different picture than what you see at Bank One today,” Edwards said. Early on, much of her job was “repairing relationships with our regulators.” But now, she says, “we have strong relationships” with them, and “they’re comfortable with the approach we’ve taken.” Edwards was active in negotiating settlements that resolved many of Bank One’s problems. In 2000 and 2001 it paid a total of $85 million to settle three class action suits involving the credit card unit. Also in 2001, regulators levied a fine of $1.8 million against the company’s capital markets subsidiary for inaccurate bookkeeping. This past January, Bank One paid $1.3 million to settle charges by 28 states that its credit card unit’s marketing partners deceived customers into signing up for unwanted services. Guggenheimer Takes The Helm But now the regulatory demands of the GC job at Bank One are winding down, according to Edwards: “We turned a corner, and turned it a long time ago.” Bank One, she says, is ready to head in a new direction. Guggenheimer will be the one to chart that course. As GC at the Salomon Smith Barney unit of Citigroup since 1998, she has also seen her fair amount of scandal: accounting irregularities at client WorldCom, Inc.; misleading stock advice by analyst Jack Grubman; and a global equity research settlement with regulators this spring. From 2001 until earlier this year, Guggenheimer also shared the post of Citigroup general counsel with Stephanie Mudick, but the women were replaced by Michael Helfer, formerly the GC at Nationwide Financial Services, Inc. After her secondary legal posts at Citi, Guggenheimer will undoubtedly be kept busy as Bank One’s number one lawyer.

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