Risk & Crisis Management
Refco CEO who oversaw bankruptcy resigns
Auteur : Reuters
Du : 24/11/2005
NEW YORK, Nov 15 (Reuters) - Refco, Inc. (RFXCQ.PK: Quote, Profile, Research) said on Tuesday that Chief Executive William Sexton resigned, having stepped into the role after a financial scandal engulfed the brokerage and forced it into bankruptcy.
Sexton, who had announced his resignation as chief operating officer before the scandal, instead became CEO to help guide the company through the crisis.
Robert Dangremond, managing director of AlixPartners, LLC, the turnaround management company advising Refco, was named interim chief executive officer, Refco said.
Sexton became CEO when his predecessor Phillip Bennett was suspended on Oct. 10 after Refco auditors said they had discovered that Bennett helped hide $430 million of debt from the company. Two days later, Bennett was arrested and charged with securities fraud.
Bennett has denied all wrongdoing.
Sexton's brief tenure came as the scandal wiped out Refco's stock price and prompted customers to flee. Refco's customer accounts for its futures brokerage dropped from $7.5 billion to just over $3 billion in a matter of days. On Oct. 17, the company and 23 subsidiaries filed for bankruptcy.
Last week, Sexton was among the Refco executives who oversaw the sale of the futures brokerage to Man Financial, the brokerage unit of Man Group Plc. (EMG.L: Quote, Profile, Research), in a deal worth more than $1.25 billion.
Private equity firm Thomas H. Lee Partners, Refco's largest shareholder, on Monday said it was suing Bennett and two former Refco executives, seeking to recover at least $245 million the firm lost in the company's collapse. Bennett's lawyer said they would "vigorously defend any lawsuit" against him.
THLee managing director Scott Schoen, also chairman of Refco's executive committee of the Board of Directors, credited Sexton with helping to keep Refco employees from departing during the scandal.
"Bill Sexton has been a key leader in protecting and preserving franchise value and jobs for more than 1,400 Refco employees in working through the process that led to last week's" Man Financial agreement, Schoen said in a statement.
Dangremond, the interim CEO, has held management positions at Mirant and Zenith Electronics and served as CEO and president of Forstmann & Company and chairman and CEO of AM International.
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Sexton, who had announced his resignation as chief operating officer before the scandal, instead became CEO to help guide the company through the crisis.
Robert Dangremond, managing director of AlixPartners, LLC, the turnaround management company advising Refco, was named interim chief executive officer, Refco said.
Sexton became CEO when his predecessor Phillip Bennett was suspended on Oct. 10 after Refco auditors said they had discovered that Bennett helped hide $430 million of debt from the company. Two days later, Bennett was arrested and charged with securities fraud.
Bennett has denied all wrongdoing.
Sexton's brief tenure came as the scandal wiped out Refco's stock price and prompted customers to flee. Refco's customer accounts for its futures brokerage dropped from $7.5 billion to just over $3 billion in a matter of days. On Oct. 17, the company and 23 subsidiaries filed for bankruptcy.
Last week, Sexton was among the Refco executives who oversaw the sale of the futures brokerage to Man Financial, the brokerage unit of Man Group Plc. (EMG.L: Quote, Profile, Research), in a deal worth more than $1.25 billion.
Private equity firm Thomas H. Lee Partners, Refco's largest shareholder, on Monday said it was suing Bennett and two former Refco executives, seeking to recover at least $245 million the firm lost in the company's collapse. Bennett's lawyer said they would "vigorously defend any lawsuit" against him.
THLee managing director Scott Schoen, also chairman of Refco's executive committee of the Board of Directors, credited Sexton with helping to keep Refco employees from departing during the scandal.
"Bill Sexton has been a key leader in protecting and preserving franchise value and jobs for more than 1,400 Refco employees in working through the process that led to last week's" Man Financial agreement, Schoen said in a statement.
Dangremond, the interim CEO, has held management positions at Mirant and Zenith Electronics and served as CEO and president of Forstmann & Company and chairman and CEO of AM International.
Related Articles
[15/05/2008] USB shuffles investment bank, beefs up risk management
[31/05/2007] Bally Total Fitness Reaches Agreement in Principle on Proposed Terms of a Consensual Restructuring With Holders of Senior Subordinated Notes
[08/05/2006] Changes at ISM, IGDA, THQ, ELSPA & More