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Chapter 5. Caffeine Badly Needed: Sleepy... > Red Flag 1: Sudden Unexplained Resig...

Red Flag 1: Sudden Unexplained Resignation of a Director from a Board

On the same day that biotechnology company ImClone Systems Inc. announced that it was under the scrutiny of the SEC and the Department of Justice, it also revealed that one of its directors, Peter Peterson, had resigned—only three months after joining. It didn’t give a reason. The beginnings of a government probe are clearly bad news for any company, but the departure of Peterson should have been an additional warning signal. He is not only chairman of the private equity concern Blackstone Group, but he is also one of the most highly respected figures in business and government circles. A former secretary of commerce in the Nixon administration, he is chairman of the Federal Reserve Bank of New York and chairman of the Council on Foreign Relations.


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