Free

A monster-sized quid pro quo?

One of the things that Sarbanes-Oxley was supposed to do was to prevent companies from making sweetheart loans to corporate execs. But there’s always a way around that. Just look at Monster Worldwide’s (MNST) proxy filed last week which notes that in 2002 Chairman and CEO Andrew McKelvey received a $3 million interest-free loan from a private company called The Marquette Group that the proxy describes as a competitor. While the proxy notes that the loan was recently repaid in full, it doesn’t provide any explanation on why a competitor would make a $3 million interest-free loan in the first place. Nor does it explain why, if the loan was made in 2002, Monster investors are first learning about it now, since it wasn’t mentioned in last year’s proxy. But that’s not McKelvey’s only dealings with this private company. The proxy also notes that this past December, Marquette bought the company that owned a corporate jet that McKelvey used to own and which Monster “periodically pays for.” The proxy doesn’t say how much Marquette spent on the plane. But if I were to hazard a guess, given the timing of the two deals, it’s probably somewhere in the neighborhood of $3 million.