By on August 2, 2015

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The court case against former FCA Australia executive Clyde Campbell is turning into a veritable who’s-who of decision makers at the company, reports The Age.

Campbell, who is charged with misappropriation of $30 million AUD of company funds, claims he had verbal permission from recently departed FCA executive John Kett, current company hotshot Mike Manley, and head of FCA Sergio Marchionne.

Campbell’s statement of defense comprises of many claims about instructions received by him from executives further up the chain of command.

One item of contention has to do with dealerships owned by formerly disgraced Mercedes executive Ernst Lieb and business partner David Piva. Campbell authorized payments from FCA to the pair to buy dealerships in Australia in order to increase FCA sales in Australia to 20,000 units per year by any means necessary.

From The Age:

Mr Campbell claims he authorised that expenditure on the instructions of Mr Manley, who “implied by a direction to increase FCA’s dealerships to 100 by June 2012” that such deals were needed.

According to Mr Campbell, at a management meeting in Shanghai in 2012, Mr Manley told him FCA needed to match the sales volume of Kia and Volkswagen in Australia.

Mr Campbell claims he replied that Kia and Volkswagen had more dealerships and FCA was trying to expand its dealership network. 

According to the court documents, Mr Manley replied with words to the effect: “I’m sick of this excuse. Get 100 dealerships by June next year or you’re out of a job. I don’t care how you do it, I don’t care how much it costs, just get it done. All your marketing is being wasted if you do not have a dealer network to deliver on it”.

Campbell also claims he received “implicit instructions” from Sergio Marchionne and former executive John Kett.

It should be mentioned many of the claims made by Campbell lack supporting evidence.

Other deals as part of the case include the purchase of a plane painted in Alfa Romeo livery (pictured) and a $400,000 Chris Craft yacht.

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20 Comments on “Campbell Points Fingers At Kett, Manley, Marchionne in Defense...”


  • avatar
    tjh8402

    hmm 182RG with a two bladed prop. Don’t see that combo too often. Every one I’ve seen has a 3 bladed prop. I get the Ferrari painted Piaggio Avanti, but I don’t quite get an Alfa Romeo liveried Cessna.

    • 0 avatar
      sgeffe

      Do they make RGs anymore? From what I’ve seen, no. And for whatever they’re doing, why not a new plane? EAAVenture, perhaps?

      • 0 avatar
        tjh8402

        No, they do not make an RG anymore. I think they stopped back in the 80 when they dropped the twins and other more complex planes. Cessna decided a while ago that their piston engine line would be fixed gear and single engine. Interestingly, they are indirectly back in that business thanks to the purchase of their old rival, Beechcraft. The Bonanza and Baron now give Cessna (a part of Textron Aviation with Beech) a retractable gear piston single and a piston twin in the lineup again as well as the King Air turboprops (what Textron really wanted). The General Aviation market, especially at the lower end, still hasn’t recovered from 2008 so new products are going to be rare. Cessna is investing in their Citation jet lineup – you’ve got the upgraded Sovereign + CJ3+, M2, X+, as well as the new Longitude and Latitude models. They’ve had delayed attempts at diesel engine versions of the 172 and 182 and the 162 has been discontinued after being a flop (production discontinued after only 4 years).

        • 0 avatar
          sgeffe

          The 162 was essentially all “made in China,” with final assembly in the U.S., correct?

          Even with FAA certification, I wouldn’t want to take a chance with that! (Same as a Volvo!) And I’m not a pilot — just have an aviation interest.

          To the point of this post: I wonder if Sergio may eventually end up falling on his sword for all this.

          • 0 avatar
            bunkie

            The real issues with the 162 had to do with poor payload and even worse crosswind capability. Oh yeah, then there was the price, which ballooned to almost double the introductory price.

            As for safety, I really would’t worry about that, the engine is a certified Lycoming 0-235 which is very solid and Cessna isn’t a fly-by-night operation.

            Being an LSA (light Sport Aircraft) brings with it real market realities. Even though the 162 was less than half the cost of a new 172, it’s still three times as expensive as a decent used 172. Yes, it’s more expensive to get a license to fly the 172 (a PPL as opposed to an SPL), but it’t much cheaper and less restrictive in the long run. I ran the math back when I was a student and it’s biased strongly against LSAs.

          • 0 avatar
            tjh8402

            @sgeffe and bunkie – the 162 did seem to have some quality issues. The main flight school at the FBO I used to work at had several problems with theirs (all bought new) including a door coming off in flight and an engine shut down. That being said, I think the problem the 162 had in the market was it didn’t do enough to differentiate itself cost wise from the 172 or establish itself in the LSA market. The flight school with us bought 3 of them and just seems to use them as a cheaper 172 (they go for $105/hr wet vs $155 for the 172). Not an insignificant amount of $, but then again the 172 is a much more capable airplane and isn’t so weight and balance limited that you’re ordering your fuel 1.5 gallons in the right tank and 3 in the left (common fuel orders for the skycatcher). Maybe the cost differential would’ve been a bit better had the flight school gone ahead and used mogas in the plane instead of our FBO full service 100LL.

            @Bunkie – I thought the math would favor an LSA if you went as far as you could with your SPL before transitioning to PP, since all your hours and training from the SPL could be applied to a PP and they theoretically were acquired at a cheaper rate.

  • avatar
    Joss

    Looks to me FCA made an uncouth hitch. They’ve only got themselves to blame. With this much money at stake they should of checked background more carefully.

    • 0 avatar
      JohnTaurus_3.0_AX4N

      Maybe they should “of” (“have” is correct, not “of”; youre confusing the spoken contraction “should’ve” with how it is writen), but to what end? How much money do you spend investigating people youre thinking of spending money on? Furthermore, if you are paying someone thousands of miles away to make those decisions for you, how much time do you take out of running a global company (or some large part of it) checking up on your people’s people just to make sure theyre not ripping you off?

      The bottom line is they trusted this guy and he took advantage of it, to the tune of millions.

      Sure, its easy to say in hind sight that more of this or that wouldve prevented it, but in the midst of the situation, its not unreasonable to expect something like this situation to fall through the cracks for a while, taking into consideration the old saying “it takes money to make money” -as in FCA was fine with giving this guy access to this amount of money if he used it to do as he was supposed to and grew the company’s sales to match bigger players in Australia. It was simply his using the money to better his and his cronies lifestyle instead with an ocean-sized barrier of protection to allow him to get away with it for as long as he did that ended up being the issue.

      People with your attitude are called “Monday morning quarterbacks”, as in guys who figured out by Monday morning what the guy (in the field, in real time) shouldve done to win the game the day before. Sometimes mistakes are made, or sometimes you can do everything right and still not win the game, or prevent some unforseen situation like this. Standing there pointing it out after the fact makes you appear arrogant and unreasonable. Blaming an entire company for one guy thousands of miles away from any supervisor betraying his employer is stupid and pointless.

  • avatar
    Noble713

    “I’m sick of this excuse. Get 100 dealerships by June next year or you’re out of a job. I don’t care how you do it, I don’t care how much it costs, just get it done.”

    Part of being a good leader is knowing to which of your minions you can give open-ended instructions like this, and to which ones you can’t.

    • 0 avatar
      JohnTaurus_3.0_AX4N

      Exactly. If this guy had been worth his salt, he couldve done so and made his company a larger player in his market, for which Im sure he wouldve been compensated for handsomly. Its a shame that wasnt enough and he felt the need to rip off his employer and probably earn himself a cell in prison. This guy cant justify all the crap he spent company money on in any way, shape or form.

      What I dont get is how he thought nobody would find out, that no matter how big the company he worked for was, no matter how many confusing and attention-grabbing things were going on within the company, that eventually the dust would settle and someone would notice what was going on while management was running around like a chicken with its head cut off trying to keep the ship afloat.

      Its like how could one of the residents of Cabot Cove, Maine think they could possibly get away with murder when freakin’ Jessica Fletcher lives there? Likewise, in this age of electronic records and digital paper trails, how do you think that nobody will ever notice you dropping $400k of company money on a yacht?!

  • avatar
    50merc

    The abuses are startling: “Company money was used, directly or indirectly, to pay for a $400,000 yacht, a plane, trips to New Orleans and Rio de Janeiro, a golf and spa holiday in New Zealand, luxury villas at Crown Casino, Victorian Racing Club memberships worth $244,800, and more than $380,000 in gift vouchers.”

    The Board of Directors should be grilling management: Are there no internal controls over purchases? Why were such expenditures not immediately flagged? Does the company own and can therefore sell the yacht and plane to recover some funds? Where were the internal auditors? How did FCA wind up hiring such pirates?

    • 0 avatar
      VoGo

      Wait. You can buy a yacht for $400K?

      • 0 avatar
        Greg Locock

        “ou can buy a yacht for $400K?” Yes, although it wouldn’t be very special. At least 10% of the yachts at my local yacht club (‘a rugby club with boats’ according to a friend) would cost around that, new . Rather like the aircraft in the photo, it is a fairly rich man’s toy, but is not to my mind much of an ad for an international brand.

        • 0 avatar

          It looks like a Chris Craft corsair or launch. Calling it a yacht would depend on your point of view (most people think megayacht) but in the traditional sense it would likely be considered a yacht but most people would view it as a large boat. The new style (post 2001 ) chris crafts are pretty nice thou I assume it was used as an entertainment expense. Lovely boat for cocktail cruises.

  • avatar
    RideHeight

    That ain’t Clyde Campbell with the Cessna.

    This is Clyde Campbell and his piranha:

    http://tinyurl.com/qza79fc

  • avatar
    Truckducken

    Is there an inside joke in the choice of ‘venerable’ rather than ‘veritable’ in the first sentence?

  • avatar
    wmba

    “Campbell’s statement of defense comprises of (sic) many claims about instructions received by him from executives further up the chain of command.”

    Of course, the possibility exists that this statement is just the first draft for Chapter 17 of Campbell’s latest fantasy novel, “The Fabulists of Andromeda Nine”.

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