Savvis Communications Corp. has placed its chief executive on unpaid leave and will launch an internal probe related to a credit card company lawsuit alleging he was two years late in paying $241,000 in charges at a Manhattan strip club.
The telecommunications carrier said Robert McCormick was placed on unpaid leave effective Monday, pending the outcome of the investigation. Jack Finlayson, president and chief operating officer, has been appointed acting CEO.
The lawsuit, brought by American Express against McCormick and Savvis last week, charges that the two were late in paying charges rung up on McCormick’s corporate credit card at Scores, a trendy New York strip club.
Savvis said Monday that McCormick did not seek reimbursement for the $241,000 in charges and that the St. Louis-based company has not made any payment to American Express related to the charges.
The tab is at the center of a lawsuit filed last week by American Express. Savvis has said it was responding to the suit.
American Express claimed that McCormick rang up the charges in a single visit to the club, while entertaining a small group of business acquaintances.
The bulk of the charges were for tips that McCormick gave to lap dancers who were entertaining his party in a VIP room known as the President’s Club, according to Scores spokesman Lonnie Hanover.
Savvis also said it had retained law firm Sullivan & Cromwell LLP, and that, upon completion of its investigation, the board’s audit committee would recommend appropriate action to the full board.
“Savvis officials do not intend to comment further on this matter pending completion of the investigation,” the company said in a statement issued late Monday evening.
McCormick and a company spokesman did not return earlier calls seeking comment.