IE 11 is not supported. For an optimal experience visit our site on another browser.

Ex-Putnam head settles pay dispute

Former Putnam Investments chief executive Lawrence J. Lasser will walk away with nearly $80 million as part of a settlement with his one-time employer, which blamed him for a mutual fund trading scandal that cost the company billions in assets.
/ Source: The Associated Press

Former Putnam Investments chief executive Lawrence J. Lasser will walk away with nearly $80 million as part of a settlement with his one-time employer, which blamed him for a mutual fund trading scandal that cost the company billions in assets.

In a regulatory filing Thursday, Putnam's parent company, Marsh & McLennan Cos., said Lasser would receive a cash payment representing $55 million in fully vested compensation and $23 million in compensation awarded, but not fully vested. Lasser and the company had been in arbitration proceedings over how much he should be paid.

Marsh & McLennan also said it will recover $25 million that had previously been expensed and set aside for Lasser as compensation. It was not clear if Lasser had sought the $25 million in arbitration.

Lasser, one of at least 16 Putnam employees to leave the firm in the wake of the scandal, could not be immediately reached for comment. A phone message was left at residential phone listing under Lasser's name in the Boston suburb of Brookline.

A Marsh & McLennan spokeswoman declined to comment.

The filing also said that Marsh & McLennan did not expect the settlement to have "a significant impact" on earnings "when combined with the costs associated with other executives who have left Putnam."

Lasser, who led the mutual fund company for 18 years, lost his job in November amid an improper fund trading scandal that engulfed the company. Clients pulled billions of dollars from the firm, and Putnam eventually agreed to pay $110 million to settle regulators' accusations of wrongdoing.

Lasser was never formally accused of wrongdoing. But in filings for the arbitration dispute, Boston-based Putnam said in March that Lasser made a "conscious decision to stick his head in the sand" about improper trading by employees. The filings also said, "Lasser was motivated by a desire to protect and maintain his position as president and CEO of Putnam." Putnam said Lasser's compensation had amounted to more than $100 million over the past five years.

An internal review by Putnam found that most improper trading took place between 1998 and 2000 in international and global funds.