Falcone steps down as CEO from Harbinger

Innovate

25/11/2014 15:57

By Svea Herbst-Bayliss 
    BOSTON, Nov 25 (Reuters) - Philip Falcone, once one of the 
world's most closely watched investors, is stepping down as 
chairman and chief executive of Harbinger Group Inc.  HRG.N  
next month to focus on his hedge fund and another publicly 
traded company. 
    Board member Joseph Steinberg will become chief executive at 
Harbinger Group, a publicly traded holding company, until a 
permanent replacement is found, the company said in a news 
release on Tuesday. 
    Falcone will be paid $40.3 million for the work he has done 
at Harbinger Group. He will also resign his position as chairman 
of the company's board. The moves will take effect Dec. 1. 
    Falcone rose to fame on Wall Street for betting against the 
subprime mortgage market in a move that saw his New York-based 
hedge fund firm, Harbinger Capital Partners, reach $26 billion 
in assets, making it one of the world's biggest. 
    He will now devote his time to the hedge fund, which still 
exists even after having been hit by heavy losses in recent 
years due to a failed wireless startup, LightSquared Inc., and 
to HC2 Holdings Inc.  HCHC.PK , another publicly traded company. 
    A year ago Falcone admitted wrongdoing and agreed to pay an 
$18 million fine to the U.S. Securities and Exchange Commission 
to settle civil fraud charges that he improperly used Harbinger 
hedge fund money and favored some of his investors. 
    He was banned from the securities industry for five years by 
U.S. regulators and was banned for seven years from 
decision-making roles at Fidelity & Guaranty Life Insurance, a 
unit of Harbinger Group Inc. 
 
 (Reporting by Svea Herbst-Bayliss; Editing by Chizu Nomiyama) 
 ((svea.herbst@thomsonreuters.com; +617 856 4331; Reuters 
Messaging: svea.herbst.thomsonreuters.com@reuters.net)) 
 
Keywords: HARBINGER GROUP FALCONE/