While Mr. Cayne has always given Mr. Greenberg credit for his contributions to the firm, he has poked fun at his offbeat personality, including his nickname, Ace, which Mr. Cayne makes a point never to use. He has a standing order among some of his closer associates: Anyone who uses the name Ace in his presence owes Mr. Cayne $100.
The final straw for Mr. Cayne was Mr. Greenberg’s decision to charge Mr. Cayne a commission of $77,000 for the sale of his six million shares of Bear stock, a rate far above the maximum $2,500 commission that employees pay for a single trade. Since Mr. Cayne was not an employee anymore, he did not deserve such a rate, Mr. Greenberg said. “If he doesn’t like it, he should do his future business elsewhere,” he added.
Compounding Mr. Cayne’s ire, say people who have spoken with him, is the question of why Mr. Greenberg, who served as chairman of Bear’s risk and executive committees during the period in which the firm’s exposure to subprime mortgages hit its peak, has himself escaped censure.
That Mr. Greenberg now claims that his warnings went unheeded has driven Mr. Cayne to further distraction, these people say. One member of the executive committee said that Mr. Greenberg, as a longtime director, had ample opportunity to voice concerns about Bear’s vast exposure to subprime mortgages and its hedging strategies, which he did not do.
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