Okay, if my memory serves me correctly, John Thain was brought in to replace Stan O’Neal as Merrill Lynch’s CEO. This occured in late 2007. Thain was hired to clean up Merrill Lynch after they lost lots of money during the mortgage/credit crisis.
So, what does Mr. Thain do after he becomes CEO? He decides to spend $1.2 million renovating his office (emphasis mine):
Mr. Thain said he plans to reimburse Merrill for the $1.2 million spent to renovate his office, saying those expenses were “incurred in a very different environment.” Mr. Thain renovated his office when he first arrived at Merrill in late 2007. Among the items purchased for the office were an area rug for $87,784, Roman shades for $7,315 and four pairs of curtains for $87,784.
Ummm…no they weren’t! True, we didn’t know how bad things were going to get, but we knew things were bad.
My question is: how bad could his office have possibly been in that would require a $1.2 million renovation?
Oh, and don’t even get me started on bonuses:
According to a person familiar with the situation, the merger agreement specified that Merrill pay regular bonuses. Since the company was going to cease to exist at the end of 2008, that meant, by definition, that the bonuses had to be paid before the end of the year.
Why would Bank of America agree to this in the first place? These companies are losing money left and right and they have the audacity to even think about paying out bonuses. COME ON!
Source: Thain Fires Back at Bank of America, Wall Street Journal Tuesday, January 27, 2009