Are you unhappy at work? Thinking of finding a quick exit strategy? Here’s good advice: announce the amount of secondary shares your company sold via Facebook before you should; use Twitter to reveal how pleased you are with the annual figures before you should and, to secure the deal, complain publicly that your board of directors are just no fun anymore.
On May 14, Gene Morphis, CFO of publicly-listed US retailer Francesca Holdings, did just that and was unceremoniously fired for his efforts.
Regardless of the intentions, as the financial face of a company, a CFO must not act with impropriety. If, for example, a public company hasn’t filed information with the appropriate regulator then any disclosure to a select audience—such as Twitter or Facebook—is very likely to be in violation of the listing rules.
But enough of the self-evident lecturing. Morphis is not the only CFO to find himself in the public eye for a lack of foresight or tact and will not be the last. So here is our selection of the more exotic behaviour that has got financial executives in hot water.
David Colby has a penchant for figures. Unfortunately, not the numerical ones he was hired to be attracted to. The former CFO of insurance company WellPoint, dubbed the Corporate Casanova, was fired in 2007 for what was described at the time as misconduct of a “non-business nature”. It was later claimed Colby had seduced scores of women across the US, allegedly giving some of his girlfriends sexually transmitted diseases while proposing to at least 12 of them. It’s surprising he found the time to do anything that was of a business nature.
As Mad As A Batter
Losing your calm in a meeting is one thing. Storming out and arriving back menacingly clutching a baseball bat is quite another. According to court documents, Mark Oleksik, CFO of merchant bank Talos Partners, left a tense discussion in April with the CEO and a board director, and came back holding a bat shouting, “you wanna talk, let’s talk,” as he closed in on the stricken boss. It’s claimed Oleksik eventually cooled enough to sit down with the bat in his lap, but it’s difficult to see how the discussion ended positively after that interlude.
It’s good to talk. Sometimes
Troubled phone operator HTC said in April it had pushed CFO Winston Yung into a vague-titled “corporate development” role. The reasons why are not clear, but Yung certainly has a reputation for being outspoken. During an earnings call made in February, Yung admitted HTC had “dropped the ball” on its selection of mobile devices, its handsets were poorly designed, especially in terms of battery life and they were not selling as well as hoped. Presumably he’s not talking to analysts or journalists in his new job.
The Truth. The Whole Truth…
And nothing but the truth. Except when you lie on your CV, of course. Which is what Kenneth Lonchar, CFO of software company Veritas (now merged with Symantec), did in order to get work. Lonchar was caught fibbing about receiving an MBA from Stanford Business School after the company received a tip-off in 2002. Lonchar swiftly resigned in shame. Veritas in Latin means “the truth”. How ironic.
For blatant conflict of interest, the firing of CFO of Boeing, Mike Sears, in 2003 is a classic case. Sears was fired for holding conversations with a former US air force official about future employment while she was still helping to negotiate a deal to buy Boeing refueling tankers. The official, Darleen Druyun, who had since joined Boeing as a deputy general manager, was also fired.