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Orix
Financial Services---Gary Gussoff “Chief of Staff.” by Christopher “Kit” Menkin Looks like the” Teflon
Don,” Gary Gussoff, formerly from CIT, is now saluted as “chief of staff.” He’s not out, and the questions on the count,
how many strikes, balls, foul hits, is not
known at this time. For the record, the “Teflon Don” remains as a “consultant”
to help Gary Corr out in the transition.
Corr, originally from Charter, met with all department heads
to give them the news personally. According
to our sources, he did a very good job at Charter, which was purchased
by Orix. Where the company is now headed, or
what is going on, is not known---but there is no secret their sole stock
holder has been painted into a $49 billion political corner. Indeed they have too much money invested to pull out...and it would
also affect their other US relationships. A memo was sent out
last Thursday, Leasing News is told, and anyone who sends us a copy may
wind up in trouble. This is what received from one “insider”: “ORIX is digging
hard to find out who leaked the story to you. if they can prove
a connection (or even have a good suspicion.) they will terminate them.” The Memo supposedly
says: “Jim Thompson is
Chairman and CEO Gary Corr is COO Brad DeLong is CIO Gary Gussoff is Chief
of Staff” It’s now “official” about Jay Holmes.
http://two.leasingnews.org/loose_files/Farewell.jpg Jay Holmes was appointed
president and chief executive officer on June 19,2000. He succeeded
John Moss, who served in these positions
on an interim basis after. Philip Cooper retired from ORIX CREDIT
ALLIANCE in March 2000. The press release
at the time stated, "In his new role, Mr. Holmes will oversee all
ORIX CREDIT ALLIANCE interests. Mr. Holmes joined ORIX CREDIT ALLIANCE after
nearly two years as President & CEO of Transamerica Equipment Financial
Services, a Chicago based provider of equipment financing and leasing
for middle-market companies in the United States and selected foreign
countries. He previously held senior positions in Heller Financial,
Inc., Chrysler Capital Corporation, Citicorp Industrial Credit and Westinghouse
Credit Corporation. He has 28 years of commercial finance experience. Jay Holmes told several
at the Equipment Leasing Association San Diego Conference, that he was asked to leave on October 8th,
with two days to clear out his office; but since, he had the travel,
hotel, and registration for the ELA in San Diego, he went. He was not
a happy camper. By the way, a similar occurrence happened when WiredCapital
took over Capital Stream. Several of the WiredCapital people went, some
did not, as the registration, travel, and hotel reservations were made. Holmes reportedly
did not like the Credit Alliance files, especially the avant guarde transactions
such as the ten year Greek diner leases in New Jersey. Most of the diners
were owned by Greeks, at this time, and they were five year payouts
written as ten year leases. Holmes
reportedly put one man on this to find out
who was getting all the money, and when the person spent over
a year looking for problems and when he came up empty, was let go. A highly reliable
source told Leasing News while he was never
involved on a direct basis with that portfolio, his remembrance
was that the deals were booked with ten year payouts, but the dealer
was only for five years worth of payments.
The excess was maintained in a reserve
and was used for delinquencies and defaults. What probably took
place is that the accounting records were not in order and it was
difficult to reconcile what money when where and when. That was a shortcoming
in the system that was used, particularly with the reserve accounts.
An inside source,
who does not want to divulge the information as it will be “traced”
back, originally told Leasing
News, “You should do some digging into why Jay was cut loose this way...he
didn't get the usual treatment...” Known as the “Teflon
Don,” Gary K. Gusoff was group president, serving on the OFS board of
directors The CIO and CAO were
let go at the first of the year at about the same time they laid off
10% of their staff. The word is they were given a nice going away party
and enough money to keep their mouths shut. It was also reported Holmes
also lost half of his responsibilities to Gary Gusoff who was promoted
to COO after failing to turn around the Equipment group. Word from insiders
is that Gusoff is like a “Teflon don.” Everything he touches seems to
fail but for some reason he never gets blamed. He just gets
promoted. Now he is “Chief of Staff.” http://www.leasingnews.org/Conscious-Top%20Stories/Orix.htm ------------- More Orix Reaction: Norden Capital was
a very small producer for Orix, for a relatively short period of time, but
I was very sorry to see them go. Steve Geller and
all of his staff always treated me in a very professional and fair manner,
and bent over backwards to get deals completed. Sometimes the documentation
process might have gotten a bit excessive, but you all know the
"Golden Rule." These
days, the brokerage community needs more Orix's. Having lived in and
traveled in Asia extensively I would also like to say a word about the parent
company, in Japan. Orix has always
been considered one of
the few, perhaps the only, really innovative financial services firm in
Japan, perhaps until recently when the former Long Term Credit Bank was taken
over by the Bank of Japan, bought by US interests and re-named Shinsei
Bank. As a non-bank lender
Orix was not under direct regulation by the Bank of Japan and the Japanese
Finance Ministry. Apparently the BOJ and the Finance Ministry were always
trying to pressure the large Japanese Banks, which they did regulate,
to "reign in" Orix, which they did not regulate. There is a saying
in Japan that the nail that sticks out of the board must be pounded down. To the Japanese Government., Orix was probably
looked at as one of those nails. I am sure that this attitude, plus the general
problems being experienced by many of the biggest Japanese banks, were/are
factors effecting Orix. Bob
Homans/Norden Capital --- I first want to say
that I do enjoy your newsletter which I
read almost daily.
What I am contacting you about is to respond briefly to some comments made recently
by parties putting blame on the
current situation at Orix Financial Services
with the previous management of Credit Alliance. I don’t think it was far at all to even mention the
Palitz brothers in the same breath as OFS as
they are both like night and day. The Palitz brothers were true pioneers of this
business and knew how to put together a secure deal and to make money. From a lot
of things I have heard about the company(OFS) since I left, I am certain they
aren’t able to do the same. I am a former employee of Credit Alliance/Orix for
almost 17 years so I think I do know what is going on. If Orix Financial Services
was doing such a great job in all aspects of their business, then how
can this situation happen? I was sitting in
the president's office of a large
east coast construction dealer recently when they received a telephone call from one of OFS's collectors.
They were calling to inform the dealer
that OFS had picked up a customers machine due to non-payment and were now asking for the dealer to pay his limited
liability amount. They then proceeded to tell
the dealer that at the time this happened, the customer was 336 days past due on
the account! Well, you can just
imagine what the reaction was with the dealer, not good at all. My point is if they
cant collect money timely on
their portfolio, then there are that and other problems ahead. I do
know that this wouldn’t have happened in the old
days. The Palitzs' certainly knew how
to collect their portfolio. My last comment also relates to OFS as well. Good luck in calling
their office and getting someone to help you. Make sure that you get
their name as there is a good chance you may not
ever find them again without it. Its a black hole. Name withheld. --- Any hint that the
Palitz Brothers had any part in the slide of ORIX is based on shear ignorance
of the actual history. After
First Interstate Bancorp ended the management
agreement with them they waited out the non compete agreement and then
started the new company in Texas with the former Credit Alliance managers
who understood what business they were in.
The Palitz brothers both said
it would take less than 10 years for the new management to run the company
into the ground when they departed First Interstate Credit Alliance. With the boom of the 90's it took 10 extra years
but the day of reckoning
for ORIX has arrived. The success of the
new Palitz venture headquartered in Texas is proof positive of the enlightened
toughness that produced 30-40 years of controlled growth
and profitability in this business niche.
It is not the good times that determine
greatness in this business, it is the lean times. The Palitz's always
expanded their business when times were tough as they had conservatively
positioned their businesses for long term success. While not flashy, that
is true brilliance and integrity amid the rancor of mere mouthy mortals long
departed. (name with held)
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