H&R Block Inc., our nation’s largest tax preparer, is now missing CEO Mark “Anybody Wanna Buy A Subprime Lender?” Ernst, after losing $1 billion in the subprime meltdown.
Richard Breeden, the hedge fund manager and former head of the U.S. Securities and Exchange Commission, was named chairman, H&R Block said in a statement today. Alan M. Bennett, who retired this year as Aetna Inc.’s chief financial officer, becomes the interim CEO of Kansas City, Missouri-based H&R Block.
Breeden, who waged a proxy fight to win a board seat in September, had urged Ernst to “stop the bleeding” at Option One Mortgage Corp. amid five quarters of losses. Ernst, 49, put Option One up for sale a year ago amid pressure from shareholders, and said in March it might fetch as much as $1.3 billion. H&R Block said in August its agreement to sell the unit to hedge fund Cerberus Capital Management LP was falling apart.
“Unfortunately, Ernst’s departure isn’t going to remove the uncertainty over the sale of Option One,” said analyst Scott Schneeberger at CIBC World Markets Inc. “They’re so mired now in subprime and the troubles there are getting so out of hand that his resignation isn’t as momentous.”
Should have stuck to preparing taxes and screwing people with those bogus fee-riddled refund anticipation loans, we guess.