Apollo’s Insurer Unit, Athene Holding, Quietly Settles Harassment Case Against CEO

By and Sabrina Willmer | September 25, 2019

The allegations described a boss letting loose with profane tirades, sexist insults, racist comments, even physical intimidation.

Purported incidents piled up for four years inside the sprawling investment empire of buyout mogul Leon Black, ending only when the accuser left her job in 2015.

Before the #MeToo movement riveted public attention on sexual harassment and gender biases in the workplace, Apollo Global Management Inc.’s lucrative insurance unit quietly settled a potentially explosive complaint that a female employee filed against the chief executive of the insurer, Athene Holding Ltd. [Editor’s note: Apollo Global Management, the investment firm led by Leon Black, completed its acquisition of Aspen Insurance Holdings on Feb. 15].

Coming shortly before Athene went public, the complaint wasn’t disclosed to all of Athene’s board of directors or to potential investors, according to three people with direct knowledge of the situation. That was a decision experts say was at odds with customary corporate governance for claims against a CEO.

The allegations involve James Belardi, who remains Athene’s top executive.

The 13-page document, filed Dec. 30, 2015, with a California state agency, paints a portrait of a boss who could act like a bully in a tense work environment.

In one July 2012 instance, Belardi allegedly responded to bad news by taking it out on his female subordinate. According to the complaint, Belardi trapped her in a chair, put his face in front of hers and bellowed at her. Then he wadded up a piece of paper and threw it at her, hitting her in the face, the complaint said.

‘Intense Culture’

The employee said she panicked and fled.

The next day, Belardi let her have it, according to the complaint.

“You don’t f-cking walk away from me when I’m yelling,” he screamed at her, following that with more expletive-laden bellowing, according to the complaint, filed with California’s Department of Fair Employment and Housing.

In a joint statement to Bloomberg News, Apollo and Athene said the matter was settled.

“Athene has an intense, performance-based culture, distinguished in the industry, and this matter involved a dissatisfied employee who had left the company,” they said. “After receiving the complaint in late 2015, independent outside counsel conducted a review, consistent with standard practices, and found no evidence of harassment, discrimination or other illegal conduct. The parties engaged in mediation, and the matter was settled in the ordinary course to avoid the much higher cost and distraction of litigation.”

The statement continued: “The complaint was discussed internally at Apollo and among Athene’s management and numerous directors.”

Confirmed Details

During the investigation by the outside law firm, several of the woman’s Athene colleagues confirmed details of her story and said her characterization of Belardi’s conduct was accurate, according to people familiar with the matter, one of whom said they witnessed some of Belardi’s behavior. The woman’s lawyer requested the state of California not further investigate her complaint because that way she would retain the right to sue.

Bloomberg News obtained the document through a public-records request.

Athene reached a $500,000 settlement with the woman in 2016, just months ahead of its initial public offering, according to people with knowledge of the situation.

Apollo established Athene in 2009 and built it into one of the top fixed-annuity providers in the U.S. In December 2016, after a delay Athene attributed to needing to improve its financial reporting, the insurer raised $1.08 billion in an initial public offering.

Athene has become an essential fixture in Apollo’s financial apparatus. The insurer allows the private equity firm to collect money from annuity holders — what’s been called “permanent capital” — and invest the assets in the credit funds, distressed debt and buyouts for which Apollo is better known. Athene accounts for about 25% of Apollo’s overall value and provides Apollo with lower borrowing costs than a typical bank.

Belardi, 62, remains an important part of the money-making machine. In addition to personal compensation last year of $4.3 million, he has a stake in Athene’s asset manager, which charges fees on the insurer’s portfolio, according to a regulatory filing. He also has co-investment interests in some Apollo funds, filings show.

Butterfly Stroke

A former collegiate swimmer at Stanford University, Belardi recorded the fastest times at 2007 U.S. Masters Swimming meets for both the 100-yard and 200-yard butterfly among 50-to-54-year-old men. That year, doctors diagnosed him with acute lymphoblastic leukemia, which he overcame thanks in part to a stem-cell donation from his sister.

At a 2015 immunotherapy-research fundraiser in New York, Belardi said that his experience with cancer made him more impatient, “wanting things done immediately so I can make a difference.”

“I hate to miss even one activity of my three kids,” Belardi said. “I also have a deeper capacity to care for those around me. I appreciate my real friends and cherish my family.”

“My focus is not on me,” he continued, “but on what I can do for others and on how I can make the world a better place.”

Belardi didn’t respond to requests for comment.

According to the employee’s complaint, Belardi repeatedly made comments on a variety of subjects the employee found objectionable.

On diversity, he suggested hiring “a black guy in a wheelchair” to “have it all covered,” the complaint said.

‘Bumble Bee’

Belardi mocked a woman’s physical appearance by saying she was fat and looked like a bumble bee, and questioned how she could have a boyfriend, according to the document. He allegedly defended canceling a pregnant employee’s parking spot by saying it was good for a pregnant woman to walk. He bragged about his own sexual prowess, his sperm count, and how well his sperm swam, the complaint said.

He also ranted about homosexuals, refused to work with women he said he didn’t find attractive and inquired about the sex life of his female subordinate, offering men in the office as possible dates, the document claimed.

The woman alleged that when she complained to HR, she was warned that if she persisted, it wouldn’t “go well” for her. She dropped her grievance, according to the complaint. The woman’s name was redacted from the document.

Best practices dictate that if there’s a financial settlement and an employee leaves, directors should know, said David Katz, a partner at Wachtell, Lipton, Rosen & Katz who’s not involved in the Athene case. If the allegations are shown not to be true, he added, there’s no need for the board to know.

No Surprises

The full board should be informed immediately when there are allegations brought against the CEO and certainly long before a settlement is paid, said Steve Walker, general counsel at the National Association of Corporate Directors, who was speaking in general and not about Athene in particular.

“The board, under no circumstances, wants to be surprised by anything,” Walker said.

The woman later saw a doctor because of what she called in the complaint her “waning physical and emotional condition.” She alleged that when HR did take action, Belardi accused her of violating company policy by reporting him. According to the complaint, she was given 24 hours to decide among three alternatives, two of which included continuing to work for Belardi. The other was resigning.

Instead, she took medical leave. She never returned to Athene.

Topics Carriers California

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