Content area
Full text
When the Securities and Exchange Commission charged Stephens Inc.'s Preston Bynum last month with defrauding a Florida utility authority, the basis for much of the complaint had been provided by Stephens itself.
Both Warren Stephens, Stephens' president and chief executive officer, and David Knight, the investment banking firm's chief counsel, say the information was compiled by Stephens in its own internal investigation last June. Stephens reported its findings to the SEC and the U.S. attorney in Pensacola, Fla.
Bynum, 55, a 12-year Stephens employee and its primary lobbyist, and Terry Busbee, a member of the Escambia County Utility Authority in Pensacola, were charged with fraud in connection with three municipal bond issues totaling about $37 million.
Stephens Inc., the Little Rock brokerage firm, was elected one of the primary underwriters on all three issues, awarded in 1990-93.
"When we do come across a situation like this, we try and act responsibly," Knight says. "We inquire into the situation, find out what happened and then, if it appears there is a problem, we immediately report it. We cooperate fully."
The Bynum indictment comes at a time when Stephens Inc. is undergoing a major transition. Sources close to the firm describe the situation as Warren Stephens' "coming of age" in the role of president.
Some entrenched, longtime executives who were put into place by Chairman Jackson T. Stephens and his late brother, Witt, are being reassigned or moved out to make way for the new generation of leadership.
"It's a time of great impending change," one knowledgeable source says, and the moves are being described as positive for an investment banking firm that has a reputation for rarely firing executives. Warren Stephens is said to be expecting more accountability and streamlining in operations.
The biggest shakeup has been in the Stephens Capital Management division. Sanford "Sandy" Besser, who has been at Stephens almost 30 years, is stepping down as head of the division, but will still work with clients. He is being replaced by Warren Simpson, who is moving over from Stephens Sports Management Inc., has 13 years' experience in the investment industry and is a...