People

Lights Out for Three Energy Executives

Two months ago, DPL's controller charged the Ohio utility's top executives with self-dealing.
Stephen TaubMay 19, 2004

Three top executives of DPL Inc., the parent of Dayton Power and Light Co., will leave the company after investigators hired by its audit committee issued a report criticizing upper management.

In a press release, DPL announced the resignations of group vice president and interim chief financial officer Caroline Muhlenkamp and chairman of the board Peter Forster. The company also announced the retirement of director, president, and chief executive officer Stephen Koziar Jr.

“The board concluded that these changes are in the best interest of the company, its shareholders, customers and employees,” said newly elected chairman Robert Biggs.

The company added in its press release that its audit committee had completed a review of matters raised by a company employee. Though DPL did not disclose the conclusions of the report, prepared by an outside law firm, it stated that the company will immediately begin the process of strengthening its disclosures, communication, access to information, internal control, and the culture of the company in certain areas.

In an 8-K filing, the DPL also announced that the Securities and Exchange Commission has requested that the company voluntarily provide certain documents and information related to previously disclosed matters raised by a company employee.

Two months ago, DPL’s controller charged the Ohio utility’s top executives with self-dealing, according to the Dayton Daily News.

The report issued to DPL’s audit committee, obtained last week by the paper, said that the energy company should have reported to the SEC a business deal between it and a private company owned by Forster and Muhlenkamp. That arrangement ensured that the two executives would continue to be paid if DPL were sold, according to the Associated Press.

The report also stated that 740 files were erased from Forster’s personal laptop computer days after investigators asked managers to keep documents related to their review. Forster said Tuesday that he turned over all relevant files, according to the wire service. The AP added that Stanley Arkin, attorney for Forster and Muhlenkamp, called the investigation of his clients “baseless.”

The board named DPL president James Mahoney as chief executive officer and appointed current treasurer Pamela Holdren as interim chief financial officer. It also announced that John Gillen has been appointed as a financial and accounting consultant to the audit committee. In addition, the board unanimously elected current directors Robert Biggs as non-executive chairman and W. August Hillenbrand as non executive vice chairman.