Aubrey McClendon: Chesapeake Energy’s Little Problem

[Frack Glop]

Aubrey McClendon: Chesapeake Energy’s Little ProblemConnecting the Dots: The Marcellus Natural Gas Play Players–Part 6
http://commonsense2.com/2012/05/naturalgasdrilling/aubrey-mcclendon-chesapeake-energy%E2%80%99s-little-problem/
By Dory Hippauf

Shareholders of Chesapeake Energy received an unwelcome wake-up call on Wednesday, April 17, 2012.

Reuter’s headline screamed “Exclusive: Chesapeake CEO took out $1.1 billion in unreported loans” – By Anna Driver and Brian Grow

Aubrey McClendon, the CEO of Chesapeake Energy Corp, has borrowed as much as $1.1 billion over the last three years against his stake in thousands of company wells – a move that analysts, academics and attorneys who reviewed loan documents say raises the potential for conflicts of interest.

The loans, which haven’t been previously detailed to shareholders, are used to fund McClendon’s operating costs for an unusual corporate perk that offers him a chance to invest in a 2.5 percent interest in every well the company drills. McClendon in turn is using the 2.5 percent stakes as collateral on those same loans, documents filed in five states show.

The size and nature of the loans raise questions about whether McClendon’s personal financial deals could compromise his fiduciary duty to Chesapeake investors, experts who reviewed the documents told Reuters.

Over the next few days as more information emerged and Chesapeake Energy attempted damage control, the market saw Chesapeake (CHK) shares hit a new 52-week low of $16.78

The damage control from Chesapeake has been, well, a bit peculiar and weak. While the actual loan transactions and failure to disclose to the shareholders may be “legal”, it does bring up the issue of conflict of interest and makes one wonder what else is going on with McClendon.

[DURHAM D]

1. I posted in your other OP that McClendon has just been removed as Chair.

I just called a friend in OKC. It was not yet being reported on the local news. This is going to rock their world.

[Frack Glop]

2. he's still CEO

the Founder Well Participation Program (FWPP) is out the door too, but not until JUNE 2014, so Aubrey still has about 2 years to make all sorts of personal deals and screw shareholders.

[madokie]

3. He is tulsa based so I see his mug in the paper quiet frequently

More than usual this last month and I was wondering to myself if maybe we don't have another ken lay. Using ken lay as an example of corrupt energy barons

[pscot]

4. There's a bench warrant out for Aubrey in Seattle

for aiding and abetting in the theft of our basketball team.

[DURHAM D]

5. LOL. Well actually I believe that was Clay Bennett.

He is married to Louise Gaylord as in the Gaylords being discussed in this thread regarding the Opry in Nashville.

http://www.democraticunderground.com/1014110340

Small world.

[pscot]

6. Bennett fronted the scam

but McClendon was a big player.

[YellowRubberDuckie]

7. You mean buying the team then moving it with the permission of the NBA?

I'm assuming the theft stuff is sarcasm, but dude, you have to get over this. It happened a long time ago.

[pscot]

8. I have no intention of getting over it.....ever.

Of course the NBA approved it. Howard Schultz and David Stern will burn in the same circle of hell. Despite the lip service, there was never any intent to keep the team in Seattle. The fix was in from day-1. Rich men get whatever the fuck they want. Period.

[YellowRubberDuckie]

9. I hate the thunder, don't get me wrong.

If I hear Thunder Up one more fucking time, someone is going to die, but it's an NBA team. It is not life or limb. It is not important by any standards known to the grand scheme of things.

[pscot]

10. In the grand sceme of things we're just tiny specs of

life clinging briefly to our meaningless existence on on the 3rd rock from a small star lost in the vast abyss of space/time. Things have whatever meaning we invest in them. On that scale the Supes were as important as god, country or a billlion Chinese. For forty years we lived and died with those guys. They lived among us. They were part of us. Then some rich bastards took 'em away, just because they could. Sob. Sorry. I'm ok now. I'll man up. I just get emotional thinking about it.