Frederick H. "Fred" Joseph (1937—2009) was the former president and

chief executive officer A chief executive officer (CEO), also known as a central executive officer (CEO), chief administrator officer (CAO) or just chief executive (CE), is one of a number of corporate executives charged with the management of an organization especially ...

of the investment bank

Drexel Burnham Lambert Drexel Burnham Lambert was an American multinational investment bank that was forced into bankruptcy in 1990 due to its involvement in illegal activities in the junk bond market, driven by senior executive Michael Milken. At its height, it was a ...

during the 1980s.

Biography

''The Wall Street Journal'' noted that he was, "The son of an orthodox Jewish cab driver and a dental hygienist, Mr. Joseph was born in 1937 and grew up in

Dorchester, Massachusetts Dorchester (colloquially referred to as Dot) is a Boston neighborhood comprising more than in the City of Boston, Massachusetts, United States. Originally, Dorchester was a separate town, founded by Puritans who emigrated in 1630 from Dorchester ...

". While at Harvard, Joseph won several

Harvard Boxing Club The Harvard Boxing Club is a student organization at Harvard University in Cambridge, Massachusetts. History Boxing has been a popular campus activity since the late 19th century. In the intramural tournament of 1879, future President Theodore Roo ...

medals. In 1963, Joseph began his career in finance in the corporate finance department of E. F. Hutton working for

John S.R. Shad John Sigsbee Rees Shad (June 27, 1923 – July 7, 1994), served as chairman of U.S. Securities and Exchange Commission between 1981 and 1987. He also served as the ambassador to the Netherlands. He earned degrees from the University of Southe ...

. Following Shad's departure from Hutton, Joseph left the firm as well to join Shearson, Hammill & Co. By the early 1970s, Joseph was Shearson's chief operating officer, the number-two post in the firm. However, in 1974, Shearson was acquired by Hayden, Stone & Co. and Joseph left the firm to join

as co-head of corporate finance. Although Drexel was only a second-tier firm at the time, Joseph had long wanted to get back into

investment banking Investment banking pertains to certain activities of a financial services company or a corporate division that consist in advisory-based financial transactions on behalf of individuals, corporations, and governments. Traditionally associated wit ...

. He boldly promised that in 10 years, Drexel would be as powerful as

Goldman Sachs Goldman Sachs () is an American multinational investment bank and financial services company. Founded in 1869, Goldman Sachs is headquartered at 200 West Street in Lower Manhattan, with regional headquarters in London, Warsaw, Bangalore, H ...

. Although junk-bond chief

Michael Milken Michael Robert Milken (born July 4, 1946) is an American financier. He is known for his role in the development of the market for high-yield bonds ("junk bonds"), and his conviction and sentence following a guilty plea on felony charges for vio ...

was the most powerful man in the firm, it was Joseph who was named president in 1984 and CEO in 1985. By this time, Drexel had more than fulfilled his bold promise, and had grown to become the fifth-largest investment bank in the nation. In 1988, Joseph was responsible for negotiating Drexel's settlement with the federal government, in which the firm entered an

Alford plea In United States law, an Alford plea, also called a Kennedy plea in West Virginia, an Alford guilty plea, and the Alford doctrine, is a guilty plea in criminal court, whereby a defendant in a criminal case does not admit to the criminal act and ...

to six felony counts and paid $650 million in fines and penalties—at the time, the largest fine ever imposed under the 1930s securities laws. In 1990, the

New York Stock Exchange The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District of Lower Manhattan in New York City. It is by far the world's largest stock exchange by market capitalization of its listed c ...

banned him from holding any management role in a firm affiliated with the exchange for three years. In 1993, the SEC barred Joseph for life from serving as president, chairman or CEO of a securities firm. Both the NYSE and SEC faulted Joseph for not properly supervising Milken. In 2009,

Portfolio.com Portfolio.com was a website published by American City Business Journals that provideed news and information for small to mid-sized businesses (SMB). It was previously the website for the monthly business magazine ''Condé Nast Portfolio'', pub ...

and

CNBC CNBC (formerly Consumer News and Business Channel) is an American basic cable business news channel. It provides business news programming on weekdays from 5:00 a.m. to 7:00 p.m., Eastern Time, while broadcasting talk sho ...

named Joseph the seventh-worst CEO in

American business history American business history is a history of business, entrepreneurship, and corporations, together with responses by consumers, critics, and government, in the United States from colonial times to the present. In broader context, it is a major part ...

, stating that his over-reliance on Milken's junk-bond unit "left the company without a crisis plan."Portfolio's Worst American CEOs of All Time - #7 Fred Joseph
CNBC, April 30, 2009 After three years as a consultant for Drexel as it wended its way through bankruptcy, Joseph served as head of Clovebrook Capital, a corporate finance consulting firm, from 1994 to 1998. He then became head of corporate finance at the American subsidiary of

ING Barings Barings Bank was a British merchant bank based in London, and one of England's List of oldest banks in continuous operation, oldest merchant banks after Berenberg Bank, Barings' close collaborator and German representative. It was founded in 1762 ...

from 1998 to 2001. After losing a bid to buy ING Barings' American operations, Joseph co-founded Morgan Joseph & Company, an investment banking firm that focuses on middle-market businesses, catering to a clientele that Drexel served in its heyday. Although the firm carried his name and he was part-owner, he was only co-head of corporate finance as a result of the SEC's lifetime ban.Drexel's Ex-Chief Is Back in Business
/ref> Joseph died on Friday, November 27, 2009 from complications of

multiple myeloma Multiple myeloma (MM), also known as plasma cell myeloma and simply myeloma, is a cancer of plasma cells, a type of white blood cell that normally produces antibodies. Often, no symptoms are noticed initially. As it progresses, bone pain, an ...

. He was survived by his five children and seven grandchildren.

References

{{DEFAULTSORT:Joseph, Fred Drexel Burnham Lambert 1937 births 2009 deaths Deaths from multiple myeloma American investment bankers Harvard Business School alumni American chief executives of financial services companies American chief operating officers

Biography

Further reading

References