Greed, Festog, Severin, and Donaldson were all fired. Severin was being invested before he was fired and was placed on investigative leave. The company is currently investigating Moriarity, McManus and others due to a US Department officials of Labor complaint. Meanwhile, the groundwork is being laid to layoff dozens more employees and free the pension and limit the lump sum. Total group sales this year top out only at $190M. Total contract terminations are at $1.6B. Plus $2B in distributions. The NYDFS is forcing additional asset adequacy testing which could means tens of millions diverted from surplus. Company is being floated for sale but few are interested and it might end up in receivership in 2-3 yrs.
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DEI!!! She would have a definite lawsuit against the company for racial discrimination.
Even though there is no more DEI hiring in the law, she is already there.
@lxvr The new leadership is highly competent, and they have a high level of ethics. Then give back to the granfathered retirees the free medical we deseved as part of our retirement package.
And how is the CHRO still there? She and her BIG salary and BIGGER ego should have been included in the first layoff.
JMO.
Classic Festog. He is delusional and clueless, also in denial.
As far as i know no one in MOA liked him but he was protected by the CEO who used him as an enforcer that is why he was there so long. He never spent more than 4-5 years in any organiztion.
So Festog is writing a book?!? That's like Captain Smith writing a book on sailing the seas!
Hi there. My name is Aaron Smith and I'm a reporter for Life Annuity Specialist, which is part of the FT. If anyone wants to discuss layoffs at Mutual of America, feel free to contact me at aaron.smith@ft.com
The last two CEO was Rich & Greed. Rich Greed or Greedy Rich. Clients laugh when they see the last two CEOs of MoA named Rich and Greed in the Financial Sector. Then the one before that was Mo--n (aka Moran). Regarding the bond impairments, that was three years ago. Cost the company $60M. S. Rich & J.R. "Ewing" Greed and others should have been left go after that. The bond portfolio might be higher quality, but the Morningstar ratings on the MoA bond funds s-u-c-k. Low performance relative to peers which cost MoA lost money and revenue generation. MoA needs to eliminate 25-30 Capital Management employees and farm out the risk and research to outside firms who are best equipped with AI. A few months ago before the hiring freeze, they were posting for a Consumer Discretionary Fund Analyst with pay approaching $300K per year !!! What a joke. Makes completely no sense and it is myopic.
There will be another round of layoffs before Christmas. Just watch. Most sales reps who do nothing should be canned. Waste of $$$ and space. The company should cut all officer pay and anyone with a VP Title or above 25% pay cut. Shared sacrifice for their over inflated salaries. Eliminate all Executive Field VPs. They do nothing and dont drive sales or retention. Many haven't sold anything in years and they don't understand customer service dynamics. The CHRO does nothing ! If it is true they are paying her $500K per year, eliminate her position. All she does is send out emails before holidays and host periodic DEI Webinars. There was another culture survey this year, and the CHRO isn't transparent at all. They haven't shown the results with the employees. The new CEO said he wanted transparency but they cover up the culture survey results. So much for transparency. Stephen, throw your employees a bone !
So sad what's happened to this once great Company. And all because of mismanagement by Greed and Festog. Meanwhile, Festog's off writing leadership articles for Forbes. What a joke! And the new CHRO must be proud of her accomplishments. That's half a million a year in salary right there they could save.
It's even worse for retirees who have yet to qualify for Medicare: With subsidies eliminated, we'll be paying $1349/month in 2025. (Checked Health Care dot gov, that's about the going rate on the open market.) Still no regrets about fleeing sooner than expected.
Corrected:
For a Retirement company, MOA has treated their retirees badly, by charging $143-$300 a month for their health benefits. This is in addtion to the Medicare premiums retirees are paying.
They should restore these benefits to all the retirees fully funded by the company, including to those that have dropped out due to the cost.
The retirees have helped build the company and now have been abandoned!!
For a Retirement cmpany, MOA has treated their retirees badly, by charging $143-300$ a month for their healt benefits.
They should restore these benefits to all the retirees, even to those that have dropped out do the cost.
The retiress have helped build the company and now have been abandoned!!
Greed was told by several outside consultants to not move to Omni. They were like, you have to leave the legacy customer behind. Instead of carefully laying the ground work 8 yrs ago and beta testing the h-ell out of it, the transition was rushed. Substandard data, reports, many errors, poor website design-the whole 9 yards. Greed claimed he had no choice, but the decisions he made along with many inept Executives who are still there, and an out of touch Board, are incomprehensible. They have harmed Mutual employees and clients with their ineptness. Clients are leaving in droves. Look at all the complaints by customers to the regulators. NYDFS, Finra, Sec, State Dept of Insurance, Dept of Labor, plus BBB. Take a look at Glassdoor even. According to the Rating agencies and public documents, Sales are way down--disbursements are way up. Surplus is being drained with NYS asset adequacy charges. Digital Transformation flopped. Festog wanted to build condos and spend $200M on a new facility in Boca. BS ! But many Executives still there and haven't yet been held accountable for THEIR DECISIONS. All Executive VPs need to be cannned.
There are no bond impairments. The portfolio is extremely high quality.
The surplus is being depleted so fast that another $100M in losses this year, a lack of a buyer for another 1/4 of 320 Park, NYDFS forced additional asset adequacy reserves, and over a loss of 1000 group plans and billions in net outflows are not sustainable. The rating agencies will lower the ratings from A to somewhere in the B's in 1+ yrs. While interest rates were so low 5 yrs ago, and before it embarked on this "digital transformation" which has so massively flopped, it should have taken a 2nd mortgage out on 320 Park and invested back into the firm. It failed to do that. Festog spent money like it was growing on trees but on the wrong things. The wrong way. Wanted to build luxury condos and spend $200M in Boca post Covid on brick and mortar? Makes no sense. Huge Bond Impairments $60M should have caused Rich and others to be fired. They know rates were going up but failed to ladder and leverage adequate ahead of time. Company has massively spent on boondoggles, stadium suites, and giving away our pension money in lavish donations to non profits. Even NYDFS said the firm was spending too much. Until you get outside leadership and a new board, the firm may have 2-3 more years hemorrhaging. To the executive who retired in 2020, you haven't been there in 3+ years but if you were, things changed in a NY Minute after you left for the worse. At the next Al Smith dinner, maybe Trump can bail the firm out with a blessing from the Archbishop Cardinal Dolan.
I worked for the company for over 20 years and was like a family when Tom Moran and Mr.Flynn ran the company. When Greed and his people took over the company turned into a huge circus. The way they went about letting people go was totally unacceptable and horrifying! So in my opinion Karma got her way!
Here is Festog's view of his "leadership" stint at Mutual of Americs. His posting on LinkedIn.
Chris FestogChris Festog
Interim Chief Financial Officer CrossPurposeInterim Chief Financial Officer CrossPurpose
A Lesson in Transition
A number of months ago, I wrote an article at Forbes Finance Council on how changing jobs can advance your career. It was one of my more popular articles! Given that I have recently changed jobs, I thought it could be beneficial to share my journey to assist others in their job transitions.
Essential for any job change is that I have completed what I set out to accomplish at the current company and that I have clarity of the next step and job. I just completed 15 amazing years at Mutual of America in New York City, three times the amount of time I had ever spent at one organization before! I served as CFO for almost 10 years and as Chairman and CEO of MoA Funds almost 2 years. During this time, I, along with an amazing team, rebuilt the Corporate Finance, Corporate Actuarial and Real Estate functions within the company. New teams, new technology, new processes, new reporting, new strategic focus. While at MoA Funds we also built a new back office and moved the funds into an active vibrant retail position in the market.
More importantly, from the day I took over these various roles, excellent qualified successors were positioned to take over from me. At that point, my work was done and it was time for the next generation of leaders to rise. Phase I of above was ticked, it was clear I had completed why I had come to MoA.
What was not clear was what was next. I communicated to leadership that my time was nearing an end almost 18 months before I finally left. I was released but to what? For those nearing retirement (as I was) I knew that I wanted to keep working but differently. I knew I was working with Forbes on a book for CFO's (more on that later) which would require a time commitment. In addition, I was serving on two non-profit Boards. So ideally more of a fractional CFO role, or consulting to pair with some writing and Board work. Most importantly, I understood that I wanted to continue to be part of a team, to invest in people and to be impacted by them. I wanted to continue to innovate, build, and transform.
The final piece fell into place in February of this year, when I met an amazing CEO, Jason Janz, at CrossPurpose in Denver. After several meetings of getting to know one another, in March, 2024, I accepted an Interim CFO role at CrossPurpose and put my notice in at MoA. I had completed what I had set out to do at MoA and it was now very evident where I had the privilege to now invest.
So effective August 1 of this year, I completed my last day at MoA and New York City and on the same day began my new life in Denver. I am now happily full-time in Denver, working at CrossPurpose and writing my first book.
New beginnings are always exciting, but they are most rewarding when you have successful closure on what you have just finished.
Greed and his Goons were successfully able to sink the ship. I have never seen such poor leadership and treatment of employees in my 30 + year career.
To hear this news about potential receivership is not a shock. The company settled a $2.75m class action lawsuit brought by former employees for charging rates 10x higher than market average. Milking their own employees when the company leadership always said "We are a family here at Mutual. " Must have been more like a dysfunctional family. Tom Moran and Mr Flynn must be rolling over in their graves to see how Greed and his Goons turned this once great company into a dumpster fire.
I spent 20 years there. It was a great company.
I am a former executive officer of Mutual of America who retired in 2020. I have kept all of my retirement savings with the Company even though I did not agree with the strategy of the previous leadership. The former leadership followed a strategy to grow the assets of the company by lowering fees to bring in new clients even though the fees were so low that they were likely unprofitable. At the same time, they went on a spending spree to modernize the home office building and the company’s systems. They did this at a time that interest rate margins were razor thin for the entire financial services industry. All of this led to operating losses and depletion of surplus.
However, the company’s surplus is more than sufficient, and its customers are not at risk of losing their savings. Your comments are in part factual, and others are incorrect and malicious. Yes, the CEO, CFO and CIO are no longer with the Company. That is a fact, and I think it is safe to conclude it is because their performance and the company’s financial results were not satisfactory. However, I have great confidence in the new leadership of the company, and I intend to keep my money with the company. The new leadership is highly competent, and they have a high level of ethics. I think it is safe to say their compensation will be lower than their predecessors, yet them have accepted the responsibility to restore the company to its strong financial position.
I don’t know what your objective is in posting information that is rumor, and factually incorrect. If you are trying to get some type of revenge against those who are no longer with the company, you are failing. You are only going to hurt the good, hard-working people who remain working for the company and are determined to get it back on course, and they will.
Yes, it appears that the Board was not paying attention while John Greed drove the Company into the ground. He thought he was the smartest person in the room, but that was only true when he was alone.
Very sad indeed.
Sad, sad, sad - What a terrible downfall for a once honorable company!