Three Ex-Hutton Employees Tell Their Stories With BC-Crash-Stocks
NEW YORK (AP) _ For Richard S. Locke, E.F. Hutton Group Inc.’s post-crash demise derailed a 13-year career at the once-proud investment giant, leaving him jobless.
Dean Thompson scrambled to start his own company after Hutton’s new parent Shearson Lehman Brothers Inc. fired him. Jack Clevenger was among the luckier ones: Shearson invited him to stay.
Hutton was the biggest Wall Street casualty in the aftermath of the Oct. 19 collapse in stock prices. Already reeling from management struggles, excessive expenses, declining profits and the legacy of an embarassing check-kiting scandal, the crash sent the company into a desperate search for a buyer.
The new Shearson Lehman Hutton Inc. describes itself as one of the strongest and biggest brokerages. But the marriage has left at least 6,000 people out of work.
″I was concerned long before the crash that the end was near,″ Locke said in an interview. ″Nothing lasts forever. We’d had a bull market for five years. The compensation had gotten out of hand.″
Locke, former senior executive vice president and managing director of Hutton’s public finance unit, had at one time been in charge of more than 80 investment bankers and earned a $700,000 salary.
When Shearson acquired Hutton in December, Locke said he was at first invited to say, but quickly discovered there was no place for him in the merged operation. ″I felt redundant. We parted friends,″ he said.
Now the 50-year-old veteran spends his time visiting potential job contacts and using a borrowed office and telephone to arrange interviews. He is considering moving to the West Coast and might start his own consulting firm.
″I don’t know what October 19th was, a signal or an accident,″ he said. ″But I think Wall Street faces much more consolidation.″
Locke said his only Hutton memento is an antique he and his wife bought, a carved-out pig from a butcher’s shop with the inscription, ″Hutton’s For Pork.″
But Locke said he harbored no bitterness toward Hutton. ″I’ve been in this business too long to get angry,″ he said.
For Thompson, who had worked at Shearson’s parent American Express Co. before he quit and went to Hutton four years ago as vice president in charge of its in-house financial video unit, there was a bitter irony in the acquisition. ″In a roundabout way I was hoist by my own petard,″ said Thompson, 41. ″Dad came back and sucked us up.″
Thompson said he earned nearly $100,000 at Hutton producing an internal monthly news show, sales promotions and advertising. Like everybody else at Hutton, he was well aware of the company’s problems but wasn’t prepared for the sudden finale.
″The big shock was the speed with which it took place,″ he said of the merger announcement. ″Twelve days later we were fired.″
With a half-dozen other people in his department, Thompson negotiated to acquire Hutton’s video production facilities, housed in a second-floor office building in Manhattan’s wholesale merchandise district north of Wall Street.
Thompson started Metro Production Group Inc., which has since received video production assignments from several financial service companies.
Dressed in casual clothes behind a simple black desk in his office, Thompson was philosophical about the sudden change and said he expected to do ″as well, if not better.″
Nevertheless, he said, ″Let’s face it. When I saw the movie ‘Broadcast News,’ I loved the line where the fired executive told the boss, ’I hope you die real soon.‴
For Clevenger, who started with Hutton in 1969, the Shearson acquisition injected stability and relief. As a first vice president in Hutton’s consulting services unit in Kansas City, Clevenger had long been worried because of client concerns about Hutton’s health.
″I was pleased that the merger happened,″ said the 42-year-old father of two.
He wouldn’t disclose his salary, but as one of the senior people in Hutton’s nationwide network, he was among the highest paid. Although his post- crash business is down 20 percent, Clevenger said, ″I’m guessing that when the year’s over, I’ll be in approximately the same position with the combined firm.″
Nevertheless, he said, he had some regrets about Hutton’s collapse.
″I’m remorseful because of what it did to a group of people that I relate to, particularly the 600 or 700 people who are part of our division. Some of the closeness has gone because some of these people have left,″ he said.
End Adv Sunday April 17