Paying for failure at First Marblehead…

First Marblehead (FMD) first caught our attention nearly two years ago after dropping from the mid-50s to around $30 a share. Over the past two years, we’ve caught a few other items (see here and here) as the stock has moved from $30 to under $3.

But nothing quite prepared us for the proxy that they filed yesterday which detailed hefty severance payments for some of the very executives who have been responsible for this train-wreck, including former CEO Jack Kopnisky, who stepped down at the end of last August. According to the proxy, Kopnisky got $516K in severance and another $9,000 to reimburse him for parking expenses, which even in Boston, seems awfully high to park a car.

Former CFO John Hupalo, who resigned about a month later after two years on the job, got $566K in severance and former Chief Administrative Officer Anne Bowen got $378K in severance. Finally, the former Chief Marketing Officer, Greg Johnson, got $226K in severance.

All told, that adds up to $1.7 million in severance for four executives who were front and center for this incredible destruction of shareholder value.