Many may not have noticed this article in the WSJ, or know much about the company Fiserv:
Fiserv Erases $30 Billion in Market Value After New CEO Pulls Guidance
Shares tumble after payments company, formerly led by Trump official Frank Bisignano, says outlook is unachievable
Just another corporate malfeasance operation, right?
Not quite.
The former CEO of Fiserv is Frank Bisignano. He left Fiserv to become the head of Social Security in the Trump Administration and has recently also been appointed the head of the IRS. I’ll let the WSJ article fill in some info:
The new leaders of Fiserv FI -44.04%decrease; red down pointing triangle gave investors a harsh reality check: The payments technology company wouldn’t hit the financial forecasts set under its former boss Frank Bisignano before he left for the Trump administration.
The disclosure sent the company’s stock tumbling 44%, erasing $30 billion in market value. Fiserv slashed its financial goals for the year and reported third-quarter results below Wall Street’s expectations. It also said its chief financial officer was leaving and it was shaking up its board of directors, replacing the chairman of the board and the head of the audit committee.
If you cut through the businessspeak (I f*^king hate businessspeak) in the article excerpt below, it seems Mr. Bisi-whatever was not forthright (some might even say he “lied”) about the state of the company he was running (bolded by me to emphasize the businessspeak):
Chief Executive Mike Lyons, who joined from PNC, said he was seeking to reset the company. As the company analyzed its business, many of the assumptions and projections set by prior leaders were too rosy, he said, with some products and projects behind schedule and macroeconomic factors proving harder than expected.
Lyons said the analysis revealed several initiatives he found to be “short-term driven” that were being used to achieve prior targets.
“As I got a more fulsome understanding of those, that obviously prompted some dissatisfaction with the way we do the process, and we’ve made leadership changes around that,” Lyons said on a call with analysts.
Lyons joined the company in January and officially took over in May.
Why would such as stand-up guy as Mr. B (we’re on familiar terms now) set “…assumptions and projections” that “…were too rosy”? Curious minds want to know (again, bolded by me for emphasis):
Bisignano was tapped to lead the Social Security Administration in January and earlier this month was given the additional role of running the Internal Revenue Service. A longtime bank executive, Bisignano had run First Data, which was acquired by Fiserv, and then took over running the combined company in 2020.
Under his federal government ethics agreement, Bisignano was required to sell his Fiserv holdings within 120 days of his May 6 confirmation as SSA commissioner.
In the following months, Bisignano, his wife and trusts affiliated with his family sold more than $558 million in Fiserv stock, according to securities filings. During that period, the stock was off its highs from earlier in the year. But the average price per share that Bisignano received was about $170—more than double the $70.60 the stock closed at on Wednesday.
Federal appointees can qualify for a special tax provision that defers capital-gains taxes on sales of assets they are required to divest. They then must reinvest in diversified mutual funds, Treasurys or other specified assets and pay capital-gains taxes when those assets are sold.
A representative for Bisignano declined to comment.
Hmmmm. So, the new guy in charge of our hard-earned social security benefits and overseeing the Accounts Receivable/Collections Dept. for the United State Government (that’s essentially what the IRS is) seems to be somewhat, shall we say, lacking in integrity, and, on the surface, also seemingly willing to manipulate the markets for personal financial gain.
Who woulda thunk? 🤔
