Ex McDonald chief fined by US financial watchdog; ready why

Key Takeaways:

• The former CEO of McDonald’s was penalised for misleading investors about his impending departure in 2019 by the US financial watchdog.
• According to the agency, the organisation was exempt from fines because it had “substantially cooperated” with the investigation.

The US financial watchdog has fined the former McDonald’s CEO for deceiving investors about his termination in 2019.

Stephen Easterbrook has agreed to pay a $400,000 fine without acknowledging or disputing the allegations.

He was let go by the fast food chain after discovering that he had a consensual employment relationship.

He had “violated company policy,” according to the Chicago-based company.

Uncovering these relationships with other staff members required further investigation.

“Any kind of intimate relationship among employees in a direct or indirect reporting relationship” is forbidden by the food juggernaut.

The British businessman initially received a severance package worth more than $105 million (£86 million).

But after an investigation, the other connections were discovered.

It filed a lawsuit against Mr Easterbrook, charging him with lying about his sexual relationships with employees.

Mr Easterbrook gave the money back in December 2021 and expressed regret for not upholding the company’s values.

He made “false as well as misleading statements to investors,” the Securities and Exchange Commission (SEC) of the United States claimed Monday.

“Easterbrook knew or was reckless in failing to know that his failure to disclose these extra violations of the firm policy before his termination might influence McDonald’s revelations to investors linked to his departure and compensation,” the statement continued.

The SEC also accused McDonald’s of “shortcomings” in its public disclosures regarding Easterbrook’s dismissal.

The agency claimed that the company had “substantially cooperated” with the investigation and would not be subject to any fines.

According to McDonald’s, the SEC order strengthened its position that Mr Easterbrook was “accountable for his misconduct.”

We fired him and filed a lawsuit when we discovered that he had lied about his actions.

“The company continues to make sure that our values are reflected in everything we do, and we are proud of our strong speak up’ culture, which encourages employees to report behaviour by any employee, including the CEO, that doesn’t meet our standards.”

From March 2015 to November 2019, Mr Easterbrook, a UK citizen raised in Watford, Hertfordshire, served as the company’s CEO after overseeing its UK operations.

He gained widespread recognition for revitalising the company’s menus, remodelling stores, and implementing better ingredients. During his time there, the value of its shares more than doubled.