What sorts of punishments await way-ward CFOs in this new era of corporate reform? For Richard K. Halford, former CFO of Kansas City, Missouri-based Owl Securities and Investments, it was not hard time, but public soul-baring.
Halford pleaded guilty last fall to violating the Foreign Corrupt Practices Act as well as to three counts of tax evasion after his company's grand but dubious scheme to build a port and beach resort in Costa Rica fell apart under federal scrutiny. His cooperation helped the Feds win a two-and-a-half-year jail term and a $60,000 fine for OSI investor Robert King, and earned Halford probation and 1,000 hours of community service, including delivering lectures about his new understanding of the evils of corporate wrongdoing.
OSI's effort to secure a land concession in Costa Rica, Feds say, included conspiracy to bribe officials there. But money from investors, including King, also funded an extravagant lifestyle for CEO Stephen Kingsley that included fancy cars and huge tabs at strip clubs. Charged with a string of federal offenses, Kingsley began wearing an FBI wire to implicate his colleagues. Then, in a bizarre twist, he attempted to stage his own abduction — apparently to escape prosecution — but suffered a fatal heart attack while wrapping his ankles in duct tape on a Missouri River bank near the OSI offices. Police noted that he was wearing latex gloves, presumably to keep his fingerprints off the tape, say sources.
As part of his restitution, Halford was supposed to perform a tell-all act of contrition before a class of University of Kansas business students. Assistant professor Christopher Anderson, who set up the talk, says Halford seemed sorry, even tearing up at one point. But Halford's version wasn't quite complete, says Anderson. "He didn't mention all these salacious details."
Sadly for Halford, Eric Palmer of the Kansas City Star attended the class and pressed him for details about Kingsley's demise and the strippers. Palmer reports that even Halford's probation officer found his talk less than forthcoming, a situation he assured the reporter would be corrected in future lectures.
CFOs on the Move
J. Phillip Cooper takes over as CFO of consulting firm Charles River Associates Inc. The firm also names Karen T. Frost as VP of finance. Cooper was acting finance head before the appointment, and Frost was division CFO of Putnam Investments.... Tasty Baking Co., owners of Tastykake, appoints David S. Marberger to the CFO spot. Marberger was VP of finance at Campbell Soup's food and beverage division.... Allstate Corp. names Dan Hale CFO, succeeding John Carl, who retired. Hale was previously CFO of Promus Hotel Corp., which was acquired by Hilton Hotels Corp. in 2000.