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Howard Silverman, the chairman and chief executive officer of Gruntal & Co., stepped down last week to make way for his successor, senior manager Robert Rittereiser.
While Silverman told his staff that he would remain to help the transition over the next two weeks, industry sources believe Gruntal's new Swiss owners forced him out to stem mounting regulatory criticism over alleged fraud and mismanagement at the firm. Zurich American Insurance Group recently purchased Home Holdings, the insurance company that owns Gruntal.
A back-office scandal last year reportedly helped prompt Silverman's departure. In a suit filed in New York Supreme Court, Gruntal alleged that a group of former Gruntal employees diverted more than $5 million over an eight-year period.
Several senior officers resigned because of their closeness to the scandal, including Charles Meizoso, senior vp of operations, and Edward Bao, Gruntal's...