CEO Watch - Ian McCarthy, Beazer Homes

Beazer Homes BZH (NYSE) CEO, Ian McCarthy has more problems than just an SEC investigation, declining profits and job cuts. CTW Investment Group, a shareholder advisory group, in a letter to the board has called for McCarthy's head.

With Beazer’s stock down nearly 80% this year and cancellations reaching a staggering 68% last quarter, decisive action by Beazer’s independent directors is required to restore investor, creditor, customer and regulatory confidence. Specifically, we call on you to immediately:

1. Replace CEO Ian J. McCarthy;
2. Name an independent board chairman; and
3. Establish a Legal and Regulatory Compliance Committee.

Rather than create sustainable, long-term value for shareholders, Mr. McCarthy has garnered egregious compensation while allowing his management team to violate federal law, improperly account for land development costs and sale-leaseback transactions, and provide undisclosed loans to executives.

Up to this point the company has not responded to the request. With the housing situation only expected to get more difficult, the company still reeling from financial related improprieties, suspension of the quarterly dividend and growing job losses, McCarthy will have a hard time saving his position.

Stay tuned as this situation heats up.

For more:

Forbes
CNN Money
CTW Investment Group Letter
Atlanta Business Chronicle
Schaefer's Research
Houston Chronicle
Financial Week

Sub-Prime Market Woes Impacts Management Turnover

Management under the gun today seems to respond a bit more quickly than in the past. Beazer Homes USA BZH (NYSE) one of the housing related stocks getting hammered, fired its chief accounting officer, Michael Rand yesterday. According to published reports he was fired for attempting to destroy documents while the company was under investigation. The announcement came after it was made public that the FBI and other agencies were investigating the firm with regard to fraud in its mortgage lending practices. Back in March, Business Week did a story indicating that Beazer was one of a number of companies under investigation by the FBI and U.S. Attorney's Office in North Carolina.

Beazer back in May agreed to cooperate with the authorities undergoing the investigation. The company appears to have acted quickly after its own internal investigation found possible wrongdoing by Rand.

For more on the story see:

BloggingStocks
Bloomberg Update 3
Forbes
Atlanta Journal Constitution
CNN Money
StreetInsider