Two Browning Ferris Board Members Resign Following SEC Inquiry
HOUSTON (AP) _ One of two executives of Browning Ferris Industries Inc. who resigned because of a federal inquiry into questionable stock sales says his actions were legal but ″appearances ... matter more than reality.″
Howard S. Hoover Jr., BFI’s general counsel, and R. John Stanton Jr., senior vice president and chief financial officer, resigned Thursday. Stanton and Hoover were also members of the board of directors.
The Securities and Exchange Commission is investigating stock sales Stanton and Hoover made in August shortly before the company issued a disappointing profit forecast.
Stanton sold 60,000 shares on Aug. 12 at $27.61 a share; Hoover sold 15,000 shares on Aug. 23 for $27 a share.
On Sept. 3, the company reported that third- and fourth-quarter results would be below analysts’ projections. The stock dropped to $21.75 that day and closed Thursday at $19.25.
In a prepared statement, Hoover said his stock sale was legal, but ″appearances and impressions often matter more than reality.″
″My decision to sell some BFI stock was motivated solely by extraneous, personal financial circumstances. I placed an order to sell ... only after my review satisfied me that at the time there was no material undisclosed information.
″Nonetheless, subsequent developments beyond my control have caused some within the company to question my loyalty to the company, and my judgment,″ he said.
Hoover, 52, joined BFI in 1970, becoming general counsel in 1975.
Stanton, in his prepared statement, did not acknowledge the SEC probe.
″Browning Ferris Industries is very important to me,″ he said. ″...Now that I am leaving full-time employment to pursue other interests, I look forward to the opportunity to be helpful and supportive in the years ahead.″
An aide to Stanton said he would have no further comment.
John Heiney, a spokesman for the SEC in Washington, said the commission as a matter of policy would not confirm or deny the existence of an ongoing investigation.
Stanton, 50, joined the company as chief financial officer in 1989, but has served on the board of directors since 1971.
Company spokesman Peter Block said temporary replacements already were named. David R. Hopkins, was named acting chief financial officer; he had been vice president, controller, and chief accounting officer.
John M. Potwin was named acting general counsel from his position as associate general counsel.