Revlon (NYSE:REV) finally agreed to a $850 K SEC fine for misleading investors back in 2009. They have already settled with investors including Fidelity for about $36.9. You see the stock went from $5 to just north of $20. A lot of investors felt they were not properly informed of the true financial picture and were stampeded out of the stock.
The SEC alleged that the company mislead independent directors by ring fencing an independent advisors report. Not good. So for quite some time now the independent investors know they were bambozzled. Yet there are several directors who were on the board at the time of the bambozzlement who are still there.
So you have known that you were misled but you chose to stick around. Management and Ron Perlman who were the guiding minds behind the events that lead to the SEC complaint are the majority control block. Very little that you can do; except once you know they can’t be trusted why hang about. You do not have the independent resources to ensure you are not fooled again.
Some of the individuals who have curiously stayed on include:
Kathi P Seifert 63, Director of Revlon since Jan 2006. Employed by Kimberley-Clark since 1978 to 2004. Executive since 1999. Also sits on boards of Eli Lilly (audit committee no less) from 2006 to present on Lexmark and Supervalu.
Alan Bernikow 72 retired in may 2003 as deputy CEO of Deloitte Touche. The accounting guys no less. He certainly should be feeling sheepish and uncomfortable but he has stayed on.
Meyer Felding 70 was a senior advisor to Morgan Stanley. He was the dean of Columbia Business School from July 1989 to June 2004 and is Dean Emeritus and Professor of Leadership and Ethics at Columbia B School. somehow he is OK with staying on. Can’t figure it out. Currently he is also a director of Macy’s from 1992 and UBS Funds from 2001.
Tamara Mellon 45 has been a director since 2008. She helped create and build J Choo, was the accessories editor for British Vogue and has held positions at Mirabella and Phyllis Walters PR. Sounds just like the right person for Revlon. Probably not a financial type and needs someone to explain the numbers. In the meantime she can look like Catherine Zeta-Jones whenever she wants.
Debra Lee 58, Chairman and CEO of BET Networks a division of Viacom. so she brings a market perspective to Revlon. But she is a lawyer and should understand the ramifications of trust. She also sits on the boards of Marriott International and was on Eastman Kodak from 1999-2011.
In any event Revlon can afford $850,000. The event is not financially material. I guess they just put more lipstick on the pig and moved on.
George Gutowski writes from a caveat emptor perspective.