CEO of America's second-largest natural gas producer and champion of hydraulic fracking has a long history of mingling personal and company finances exposed. Often seen as an aggressive visionary, he was forced to sell all but 1% of his shares in 2008 and since then was allowed to run amuck by Chesapeake's board. The board stripped Aubrey of his Chairman title, but he remains CEO. Stock down 20% YTD.
Documents reviewed by The Wall Street Journal show that several major Wall Street banks lent Aubrey money and then received lucrative work as public-offering underwriters or financial advisers to Chesapeake.
Personally borrowed $500 million from EIG Global Energy Partners, which had also been a large financer for Chesapeake. In securing personal loans from his company's business associate, McClendon exposed himself to a potential conflict of interest, as it's reasonable to expect him to feel pressure to serve EIG's interests in future corporate transactions, potentially at the expense of the best interests of shareholders.
Reuters exposed a $200 million hedge fund trading oil and gas McClendon ran at the same time he was CEO of Chesapeake -- an obvious conflict of interest.
Personal piggy bank and conflicts of interest. While all disclosed, actions are opposite of appropriate corporate governance and leadership: Company jets for personal purposes, Chesapeake employees working for McClendon personally, corporate sponsorship deal for Oklahoma Thunder while McClendon was an owner of the team), old friends on board. Reminds me of Rigas family of Adelphia (not disclosed, so they ended up in jail), and other CEOs who couldn't keep personal and business sides of life separate.