The Gold Standard

Capital One's John Finneran expects the best

Published in Corporate Counsel Edition® - 2009 Magazine — January 2009

When asked to identify his hometown, John Finneran can't name a single city. "I am from everywhere and nowhere," he says.

That's what happens when you're a Navy brat.

Finneran lived in 18 cities during his first 18 years, moving up and down the East and West Coasts with his parents, brother and three sisters. Most of the time his mom was really a single parent, he says, keeping the home and raising the kids. Every year it was a new school, different friends. But—like other trials of character—he insists it's been for the best.

"Our stability as a family is what helped ease our transitions," he says, "and I always looked forward to making new friends at every place in which we lived."

It's also why he craved a position of stability in his professional career. As Capital One's general counsel and corporate secretary since 1994, that's just what he got.

 

Finneran's formative years occurred during the rise of JFK, Martin Luther King Jr. and the Beatles. His maternal grandfather, an esteemed trial lawyer who represented the Long Island Railroad Co. and had worked on the precedent-setting Palsgraf tort case in 1928, enjoyed discussing the issues of the day with his grandson.

"I remember raucous debates with him about everything," Finneran says. "It was a time, quite frankly, when there were still big differences in the country."

This was in the mid-1960s, after all, and Finneran admits his grandfather "took the brunt of my teenage rebellion." Finneran's politics then tended toward the ideals of the Great Society. And his grandfather's? "He had a vision of a smaller government than I did at the time." (Today Finneran's politics are "somewhere near the middle," he says.)

His father, John G. Finneran, also inspired his son's passion for service, leadership and the law. His naval career spanned 31 years, including service in the Cuban Missile Crisis and Vietnam. He retired as a vice admiral in 1978. So when young Finneran graduated from Pennsylvania State University in 1972 with a low draft number, his decision was simple: He joined the Navy.

He moved to Newport, R.I., for Officer Candidate School, then boarded the USS San Bernardino in San Diego, making regular trips to the South Pacific. In 1974, he transferred to the Bureau of Naval Personnel in Washington, D.C. While stationed in the nation's capital, he realized it was time to start planning for the rest of his life. He considered law, government and politics. "I would have volunteered to rewrite my high school student government constitution if anyone had asked me to," he says. 

With the help of the GI Bill, Finneran attended Georgetown University Law Center at night while finishing up his Navy commitment during the day. "Those were four years that I don't have very many memories of, to be honest," he says of the daily grind.

After graduation, he was sure of three things: "I knew I didn't want to become a criminal lawyer—or a small-town lawyer," he says. "What interested me the most was business law."

That interest was further fueled by a clerkship in Cleary Gottlieb's Washington, D.C., office. "What I loved most about that firm was the ability not to specialize," he says. "The business of law has, I think, increasingly driven people to specialization. I grew a real passion for solving business problems, rather than be a lawyer with a functional specialty."

Watching his parents' sacrifice in service to the country inspired Finneran to join the Federal Deposit Insurance Corporation during the banking crisis of the early 1990s. "They needed someone to come in and help at a time when banks were failing in large numbers," he says. "They wanted people who could bring a private sector perspective to how to resolve failing banks."

The FDIC brought in Harrison Young, a prominent investment banker, to lead a small team tasked with conceptualizing new ways to approach the crisis. Young needed an attorney who could pull off large corporate transactions—one who could find buyers for banks that were failing and minimize the financial hit to the taxpayers. He chose Finneran.

The group's work ultimately helped resolve institutional challenges at less cost to the government.

"We really were a great team," says Finneran, who walked away from the experience with new ideas about his career path. "It convinced me that the opportunity to marry business and law was easier and more available to accomplish when you work for one client."

That opportunity presented itself in the form of Richard Fairbank, founder and CEO of Capital One Financial Corporation. He asked Finneran to come aboard as general counsel just months before the bank announced its IPO in 1994.

The timing was right. Banks were no longer failing at the rate they were during the crisis. "Sometimes you just bump into things along the way and grab them," Finneran says.

Since helping launch the independent company, Finneran has played a key role in the evolution of Capital One from a credit card company that revolutionized the industry with data-driven credit card pricing—giving those with better credit lower interest rates—into one of the nation's top 10 banks. He has been a major player in Capital One's steady acquisition of banks and other holdings, as well as its expansion into Canada and the United Kingdom.

"I view myself principally as the lawyer," says Finneran, who operates from Capital One's headquarters in McLean, Va. "But also, quite honestly, as someone who is looked to to pull together all the various elements to protect and enhance the corporate reputation."

He's a full-time member of the corporate inner circle, as much an adviser on business matters and external relations as he is the company's lead attorney. He is also in charge of brand management, corporate affairs, regulatory relations and administration.

"It's hard to exaggerate the importance of a great general counsel," says Fairbank. "John combines a deep understanding of the business with his impeccable values. As our general counsel and an executive committee member, he is a trusted and influential partner and adviser on important business, legal, reputational and governance issues facing our company."

Even in the midst of the latest banking crisis, Finneran is unflappable, reasoned and smart, says Ann Fritz Hackett, president of Horizon Consulting Group and a Capital One director. "You really want someone in that role who is going to add value and have that calmness, no matter what comes along."

In these uncertain times, Finneran says that access and voice are even more critical. "Today we are seeing the financial services and banking industries change faster than at any time in our history. It certainly is a challenging environment for financial institutions of all types and Capital One hasn't been immune to that," he explains. "But we're in a good place. Capital One is now among the largest banks in the U.S. and our credit card business is among the best in the industry. Although one cannot deny that there is some uncertainty in the direction of the U.S. economy, I like how Capital One is positioned."

Married to Catherine, a former attorney, and father to a 20-year-old son and a 15-year-old daughter, Finneran spends much of his spare time attending soccer games and tennis matches. In the summertime he works on the garden outside their Maryland home and takes the sailboat out.

But he still relishes leading a legal department of 140 associates housed all over the country. When he joined Capital One in 1994, the legal team consisted of him, another attorney, a paralegal and an assistant. Today U.S. offices include Virginia, New York, New Jersey, Louisiana and Texas.

"As I have often said, I have the easiest general counsel job in America," he says. "And I say that for one principal reason: I have been blessed with a client—the businesspeople who run and shape Capital One—who is very receptive to having a lawyer as a partner in growing and shaping the business. I have never had to fight to get a seat at the table."

It is perhaps no surprise that when you ask Finneran where he's going in the next five, 10 or even 15 years, his answer is: "I see myself as no place else but right here."

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