By on October 19, 2011

The German business paper Handelsblatt reports that Mercedes-Benz USA CEO Ernst Lieb, a 36-year Daimler veteran, has been fired for “serious and repeated” violations of the company’s internal finance compliance rules. Per the Dow Jones [via FoxBusiness] translation,

Lieb is said to have remodeled his house in New York at the expense of Daimler and settled personal golf club contributions through the company, the executive is reported as saying.

Lieb has also been accused of providing favors at the company’s expense, such as renting cars in exchange for flight upgrades

In the words of one “longtime Daimler executive,”

Ernst was warned, but he has done it again

According to Handelsblatt, internal whistleblowers are likely responsible for Lieb’s firing, as Daimler’s new “zero tolerance” policy on such misconduct outweighed the loyalty felt for such a long-standing executive. But there will be consequences from Lieb’s firing, as the paper notes that Lieb had done much to repair shattered relations with Mercedes’ US dealers (sure enough, a planned dealer meeting has been canceled). But Daimler had to stand firm: six years ago, a similar issue arose when a German sales manager was found to have used company funds to renovate his house in Majorca. Now, at least, there’s no question as to where Daimler stands on the conduct of even its top executives.

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16 Comments on “Mercedes USA Boss Fired For “Serious And Repeated” Financial Violations...”

  • avatar

    He probably made enuf mulla as no need to dip into corporate ink!
    But people are greedy, suddenly they start to think MBUSA is all his.
    Or in Law as absolute liability, u dont have much of any excuses.
    Now his career is done, toast and need a bit of jam to make it look nice, or call in the Rabbi for his last Rite.

  • avatar

    Okay, “Occupiers”, it’s time to occupy Mercedes! The horror of it all!

  • avatar

    I heard he was fired a couple days ago, but there wasn’t an explanation then. Well, it’s good to see Daimler doesn’t let their executives run free using corporate expense accounts like a credit card.

  • avatar

    You’d think after getting caught once the man would have stopped, but greed makes people do strange, sometimes self-destructive things. And arrogance makes them think they can get away with it.

  • avatar

    Did he receive a golden parachute with his termination?

    • 0 avatar

      if you get terminated with cause (theft of company resources, after being warned, in this case apparently) you can often get nothing, including no pension or other benefits. let’s hope that was the case here – if you are making 7-figure salary, stealing tens (or hundreds if it was a lot of remodeling) of thousands of dollars is just f*cking stupid beyond words.

      wholesale Enron/Madoff level corporate makes sense (as much as fraud/theft does in any case, in whatever warped logic is applied by the do-er) in that you are hoping to get away with enterprise-level fraud and with really, really serious money, but this sort of thing is like stealing office supplies or shoplifting for the thrill of it.

  • avatar

    Sounds like this guy wanted to get canned, or he and his bosses never saw eye-to-eye on the structure of his total compensation package.

  • avatar

    In the fraud-investigation trade, experts speak of the Fraud Triangle:

    – Pressure (to do the deed on account of need or greed),

    – Opportunity (because of no or a weak culture of compliance, and weak or non-existant internal controls, leaves people to steal because they think they can, or will not get caught),

    – Rationalization (and thoughts of getting caught are brushed-away with thoughts of why one is justified in taking the dough, as in “they owe it to me”.)

  • avatar

    Could it be German/European thing? I’ve heard that due to higher taxes, its much more common for European executives to receive significant portions of their compensation in kind.

    • 0 avatar

      13 years living in Europe/CH and I’ve never seen a hint of this.

      One interesting thing though … many of the Daimler business cards in my “Rolodex” have the person’s private address printed on the reverse side of the card; the story always was that these were the guys trolling for expensive presents that could not be legally sent to them at their office address. (Maybe Bertel can shed some more light on this point.)

  • avatar

    And people wonder why there is growing outrage at corporate excesses.

    If Gunter the mailroom clerk was stealing checks from Mercedes he’d go to jail. Just sayin’

    • 0 avatar

      What corporate excess? An individual took advantage of a situation.

      Why outrage? Someone did something wrong, was caught, and fired. We’ll see if he’s prosecuted. I’m sure that because of tax implications there will be a criminal investigation whether or not Daimler files charges.

      Did you know that banks rarely prosecute tellers and other low level embezzlers? It’s not good business for the public to think your employees are thieves. A bank is much more likely to prosecute an employee that stole millions than it would low level theft.

      In any case, there’s probably at least as much fraud and dishonesty in the public sector as there is in the corporate world. The difference is that in the private sector there is some accountability. How many incompetent and corrupt government employees get fired?

      For every one of your Gunters, there’s probably a GS-13 that fudged some expense accounts or used a government credit card inappropriately.

      I’m trying to figure out just how lax M-B’s purchasing procedures are. Either that or all of his subordinates knew this was going on. This guy’s the CEO, he doesn’t sign purchase orders for construction. Just exactly how did he get the company to pay for the work on his house? I can see being able to fudge golf fees under entertainment expenses, and using his company credit card to rent a car for someone, but home remodeling?

  • avatar

    Mercedes-benz provides ” company ” home to their top executives .
    So any home repair would have been done on the ” company ” home .
    Club memberships are standard perks of any top job in almost any industry .
    So nothing unusual .
    I smell a personal vendata .
    I’m a GM at a US M-B retailer and there has never been a better president at Mercedes USA .

    He will be missed .

  • avatar

    People like him are a dime a dozen in my country.

  • avatar

    MR. Lieb doesn’t even live in NY let alone have a house. The house in NJ is own by MBUSA so any money he would have spent on it would have benefited the house which is owned by the company.

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