On the web site of investment firm Needham & Co., the news section offers several announcements from June and then from November in 2012. What’s missing — for good reason — is news that appeared in a November 16, 2012 issue of the Wall Street Journal: according to the newspaper, U.S. prosecutors arrested the company’s former CFO. The Federal prosecutors charged that the financial official had colluded with vendors in an overbilling scheme that netted $1 million for himself.
According to the Wall Street Journal article, Needham & Co. became aware of the deception before the CFO resigned in February, 2011.
A company that proclaims on its web site “The Firm’s commitment to exceptional service is unusual in today’s business climate, and is born of a tradition which stresses integrity above all else” must have been outraged as well as shaken by the alleged deceit.
The web site makes it seem that the firm has found its legs, and perhaps never stumbled at all.
But why must a firm competing for the trust of investors need to put that trust at risk through the conduct of its own executives? Why manage the crisis if the crisis can be kept from occurring? (posted January 9, 2013)