Feds Investigating Conduct Behind Firing of MassMutual CEO

By | August 11, 2005

Federal prosecutors are investigating the conduct that led to the firing of former MassMutual chief executive Robert J. O’Connell, the company disclosed in court documents.

The company acknowledged the federal probe as part of a complaint, filed in Hartford Superior Court, that seeks to stop Connecticut Attorney General Richard Blumenthal from releasing MassMutual’s internal investigative reports into O’Connell’s actions.

The company has accused O’Connell of engaging in a “systematic and pervasive pattern” of abuse of authority.

Blumenthal advised MassMutual he would release the company’s documents in response to a Freedom of Information request from The Hartford Courant.

In its complaint, the Springfield, Mass.-based life insurance company cited criminal investigations being conducted by Massachusetts Attorney General Tom Reilly and the U.S. attorney’s office in Massachusetts as a reason to keep the reports confidential.

Samantha Martin, a spokeswoman for the U.S. attorney’s office in Boston, would not confirm or deny an investigation. Reilly has said he is conducting a criminal probe, and has asked Blumenthal not to release the reports.

“The release and dissemination of this material at this time could prove detrimental to this investigation,” Massachusetts Assistant Attorney General Richard Grundy said last week.

In firing O’Connell in June, the company accused him of engaging in a “systematic and pervasive pattern of willful abuse of authority,” and “willful gross misconduct.” The company also said he had used unauthorized trading techniques to boost the value of a supplemental retirement fund and bought a company-owned condominium in Florida at a below-market price.

O’Connell has vowed to fight his dismissal, saying virtually every accusation is unsubstantiated.

MassMutual’s board of directors established a committee in February that reviewed documents and interviewed about 80 witnesses, including current and former employees, the company said in court papers filed Friday.

The committee produced a preliminary report of facts and a separate report that presented the results of the investigation.

Blumenthal sought the reports as part of his probe into insurance brokerage fees and possible anticompetitive practices, he said. MassMutual was one of dozens of insurance companies he subpoenaed.

The company turned over the reports to Blumenthal in June with the request they remain confidential. MassMutual said the reports contain confidential information relating to current and former employees and also include commercial and financial information of MassMutual.

The company insists the reports are not subject to the state’s Freedom of Information law, but Blumenthal said that without a “specific exemption,” he is required to release the documents.

“We concluded there is no exemption,” he said.

He said he was prepared to release the reports until Hartford Superior Court Judge Kevin Booth issued a restraining order on July 22.

Booth has scheduled hearings on the matter for Aug. 12 and 19.

Copyright 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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