Ex Citi exec Thomson says he was smeared

NEW YORK Tue Nov 6, 2007 5:22pm EST

Todd Thomson, CEO and Founder Headwaters Capital, speaks at the Reuters Finance Summit in New York November 6, 2007. REUTERS/Brendan McDermid

Todd Thomson, CEO and Founder Headwaters Capital, speaks at the Reuters Finance Summit in New York November 6, 2007.

Credit: Reuters/Brendan McDermid

NEW YORK (Reuters) - Former Citigroup (C.N) wealth management head Todd Thomson says he was smeared.

Citi said in January that Thomson was leaving "to pursue other interests." But press reports, including the New York Times and the Wall Street Journal, said he was kicked out because of his extravagance with company funds and questions about his judgment.

Thomson was quiet at the time, but in his first major public statement since being let go, he said his performance at Citi is unimpeachable, and suspects rumors to the contrary came from former Citi Chief Executive Charles Prince himself.

"I was the only business that had expense growth less than revenue growth. I was Sandy (Weill)'s CFO for four-and-a-half years. You think I somehow lost my cost management capabilities? This is insane," Thomson said at the Reuters Finance Summit in New York on Tuesday.

A spokesman for Citi said that allegations that Prince was spreading rumors regarding Thomson are "utterly and entirely false." A call to Prince's office was forwarded to a Citi spokesman.

Sandy Weill, the architect of Citigroup known for relentless cost cutting, hired Thomson from General Electric Co. (GE.N) in 1998 and by 2000 Thomson was chief financial officer. In 2004, Thomson swapped positions with Sallie Krawcheck, who had been head of wealth management.

Thomson's career at Citi came to a halt earlier this year when he left amid press reports of extravagance on his watch. The Wall Street Journal wrote that Thomson had developed a "reputation inside the company as a free spender," and his Citigroup office on 7th Avenue in midtown Manhattan was known as the "Todd Mahal."

When asked about the office space, Thomson said the office space in midtown actually saved Citi money -- it cost $44 a square foot, compared to about $80 a square foot at Citi's headquarters on Park Avenue.

"We were on 7th Avenue -- this is not the high rent part of New York."

Press reports mentioned the fish tank in his office. But that tank had eight goldfish and one black fish, which is considered good luck in Chinese culture, in which eight is a lucky number.

"For me to have a small freshwater goldfish bowl in my office meant, when a Chinese client comes, he says, 'this guy understands our culture a little bit.' If that gives me a little bit of a leg up with three or four Chinese billionaires, I think I've paid for the goldfish bowl," Thomson said.

SIGNIFICANT RIFTS

Press coverage focused on Thomson's relationship with CNBC anchor Maria Bartiromo. One episode that appeared in several media reports was a business trip in November 2006 when Thomson flew with a group of Citigroup employees to China, and flew back with Bartiromo, leaving the Citi employees to find their way home on their own.

When asked about his relationship with Bartiromo, Thomson was adamant: "It's an inappropriate question. I've never been accused of having anything other than an appropriate relationship with Maria Bartiromo. And I do have an appropriate relationship with Maria Bartiromo."

So why did he leave Citi?

Thomson said he does not know the immediate cause, but said the underlying cause was tension with Prince over how Citi was run.

"There was a very significant rift between me and the now ex-CEO ... To be clear, there was nothing I did at the company that was in any way untoward," Thomson said.

Thomson, who is founder and CEO of investment firm Headwaters Capital, said he suspects at least one of the "people familiar with the matter" that fed the stories of Bartiromo and the fish tank to multiple media outlets was Prince.

"I had a conversation yesterday with a reporter with one of the news magazines who apologized, who said to me, we knew that it was Chuck Prince personally placing calls to reporters to put that story and we didn't write it and I'm sorry." Thomson declined to identify the magazine or the reporter.

Prince was looking to deflect criticism that Citi's costs were too high, Thomson said.

"What was management of Citi being criticized for a year ago? Costs, right. So if you're trying to get rid of someone, what do you want to try to pin on?"

In the end, Thomson said he grew increasingly dissatisfied with Prince's management style, and should have just left on his own accord.

"The advice I always give people is if you're not happy with what you're doing, go do something else. I didn't take my own advice," Thomson said.

(For summit blog: summitnotebook.reuters.com/)