Albert J. Dunlap

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Albert J. Dunlap
Albert John Dunlap

(1937-07-26) July 26, 1937 (age 81)
Other namesChainsaw Al (Nickname)
EducationWest Point
OccupationRetired Corporate Executive

Albert John Dunlap (born July 26, 1937[1]) is a former American corporate executive. He is was known at the peak of his career as a turnaround specialist and professional downsizer. It was later discovered that his reputed turnarounds were elaborate frauds. The ruthless methods he employed to streamline failing companies, most notably Scott Paper, won him the nicknames "Chainsaw Al" and "Rambo in Pinstripes". However, his career was effectively ended after he engineered a massive accounting scandal at Sunbeam Products, now Sunbeam-Oster, that ultimately cost that company its independence. He is barred from serving as an officer of a publicly traded corporation in the United States. His widespread layoffs and accounting frauds have put him on several lists of worst CEOs.

Early career[edit]

Born in Hoboken, New Jersey,[1] Dunlap entered West Point in 1956[2] and graduated with a degree in engineering. He served in the US Army for three years before entering the business world at Kimberly-Clark Corporation in 1963 as part of its manufacturing operations [3]. He worked there for four years before being taken on at Sterling Pulp & Paper where he was put in charge of the family run business[2].

He engineered a massive accounting fraud at Nitec, a paper-mill company in Niagara Falls, New York. He was the company's president from 1974 to 1976, when he was fired owing to his abrasive management style. An audit by Arthur Young (now part of Ernst & Young) revealed numerous irregularities, including inflated inventory and nonexistent sales—circumstances similar to the later Sunbeam case. The final result was that Nitec's $5 million profit for 1976 was actually a $5.5 million loss. Nitec sued Dunlap for fraud but was ultimately forced out of business. However, Dunlap never mentioned Nitec on his resume, and these scandals were not widely known until reported by The New York Times after the scandals at Sunbeam.[4]

Lily Tulip Cup hired him as the President and CEO in 1983. In 1985 he was given the additional post of Chairman of the same company.[5]

From 1991 to 1993 he was offered the position of CEO for Consolidated Press Holdings (CPH), a private company belonging to the Packer family, after Kerry Packer took a leave of absence due to health reasons. At the time, CPH had a diverse portfolio in media and publishing as well as chemical and agricultural operations. While there, he had mentored James Packer for the three years[6].

In 1994, Dunlap became the CEO of Scott Paper after Philip E. Lippincott stepped down from the position[7]. He sold Scott Paper to Kimberly-Clark in 1995 for $9 billion[8] and was given $100 million for his services[9].


He took over as chairman and CEO of Sunbeam in 1996. His methods resulted in Sunbeam's reporting record earnings of $189 million in 1997.[10] However, he was unable to find a buyer by 1998. Dunlap then decided to buy controlling interest in camping gear maker Coleman, coffee machine maker Signature Brands (best known for making Mr. Coffee) and smoke detector maker First Alert. Within two days, Sunbeam's stock jumped to an all-time high of $52 per share.[11]

However, industry insiders were suspicious when they discovered certain seasonal items were being sold at higher volume than normal for the time of year. For instance, large numbers of barbecue grills were being sold during the fourth quarter. It turned out that Dunlap had been selling products to retailers at large discounts. The products were stored in third-party warehouses to be delivered later. This strategy, known as "bill and hold", is an accepted accounting practice as long as the sales are booked after delivery. However, Dunlap booked the sales immediately. Many shareholders felt they had been tricked into buying stock that was worth far less than it actually was, and they filed a class-action lawsuit against Dunlap and Sunbeam.[11]

Reports of the methods Dunlap used to inflate revenues led the board to review Dunlap's practices in June 1998. It turned out that Dunlap had sold retailers far more merchandise than they could handle. With the stores hopelessly overstocked, unsold inventory piled up in Sunbeam's warehouses. As a result, Sunbeam faced losses of as much as $60 million in the second quarter of 1998. Dunlap's search for a buyer for Sunbeam in 1997 was timed so that the huge inventory-related losses would come to light after the sale had closed. The company's comptroller also told the board that Dunlap had told him to push the limits of accounting principles. On June 13, Dunlap was fired. The shareholder suit against Dunlap dragged on until 2002, when he agreed to pay $15 million to settle the allegations.[11][12]

In 2001, the Securities and Exchange Commission sued Dunlap, alleging that he had engineered a massive accounting fraud. Also named in the suit were four other former Sunbeam executives and Phillip E. Harlow, the lead partner for Sunbeam's account with Arthur Andersen LLP. An SEC investigation revealed that Dunlap and others had created the impression of a greater loss in 1996 in order to make it look like the company had experienced a dramatic turnaround in 1997. By the SEC's estimate, at least $60 million of Sunbeam's 1997 earnings were fraudulent. He also offered incentives for retailers to sell products that would have otherwise been sold later in the year, a practice known as "channel stuffing". The SEC also argued that the purchases of Coleman, Signature and First Alert were made to conceal Sunbeam's growing problems. Sunbeam never recovered from the scandal and was forced into bankruptcy in 2002.[10]

Dunlap was also suspected of irregularities at Scott Paper. Not long after the shareholder settlement, he agreed to pay $500,000 to settle the SEC's charges. He was also banned from serving as an officer or director of any public company.[13] The Justice Department investigated Sunbeam's management during Dunlap's tenure but ultimately did not file any charges.[14]

Business philosophy[edit]

Dunlap believed that the primary goal of any business should be to make money for its shareholders. By all accounts this pursuit of profit was wholly unchecked by any regard for human dignity or compassion. To that end, he believed in making widespread cuts, including massive layoffs, in order to streamline operations. By firing thousands of employees at once and closing plants and factories, he drastically altered the economic status of such corporations as Scott Paper and Crown Zellerbach.

In 2005, the business magazine Fast Company included Dunlap in the article "Is Your Boss a Psychopath", noting he "might score impressively on the Corporate Psychopathy checklist."[15] The magazine's editor. John A. Byrne, noted: "In all my years of reporting, I had never come across an executive as manipulative, ruthless, and destructive as Al Dunlap. Until the Securities and Exchange Commission barred him from ever serving as an officer of a public corporation, Dunlap sucked the very life and soul out of companies and people. He stole dignity, purpose, and sense out of organizations and replaced those ideals with fear and intimidation."[16]

In the book The Psychopath Test, the author, Jon Ronson, recounted an interview he did with Dunlap in which he asked Dunlap if he felt he fit the characteristics of a psychopath, though without initially using the label "psychopath." According to Ronson, Dunlap freely admitted to possessing many of the traits of a psychopath, but that he considered them positive traits such as leadership and decisiveness.[17] In a review of the book, Business Week reported that Dunlap "scores pretty high on the Hare Psychopathy Checklist." Ronson, however, also noted that Dunlap lacked other elements of psychopathy, such as a history of juvenile delinquency or unstable romantic relationships.[18]

In May 2009, Conde Nast named Dunlap the 6th worst CEO of all time.[19][20]

In popular culture[edit]

A documentary film was made about Dunlap in 1998 called Cutting to the Core—Albert J. Dunlap.[21]

A documentary film by the BBC about business titans in Britain prominently featuring Dunlap called The Mayfair Set was released in 1999.[22][better source needed]

In 2001, he was caricatured in Titans of Finance (Alternative Comics, 2001, ISBN 1-891867-05-9)[23] by R. Walker and Josh Neufeld.[24] The comic book is a collaboration between a cartoonist and a finance columnist, which casts Wall Street executives and traders as heroes and villains. The lead story features Ronald O. Perelman, and Mike Vranos and Victor Niederhoffer are among those included.

In 2002, a documentary film by the U.S. TV program Frontline was released named Bigger Than Enron. It detailed the events that occurred at Sunbeam when Dunlap was CEO and investigated the accounting practices that were implemented.


  • Dunlap, Albert J.; Bob Andelman (1997). Mean Business: How I Save Bad Companies and Make Good Companies Great. New York: Fireside. ISBN 0-684-84406-0.
  • Byrne, John A. (1999). Chainsaw: The Notorious Career of Al Dunlap in the Era of Profit-at-Any-Price. New York: HarperBusiness. ISBN 0-06-661980-7.
  • Byron, Christopher M. (2005). Testosterone Inc.: Tales of CEOs Gone Wild. New York: John Wiley & Sons. ISBN 0-471-70623-X.


  1. ^ a b Feiden, Douglas. "SUN SETS ON 6,000 'CHAINSAW AL' SAYS: I'M A SUPERSTAR" New York Daily News November 13, 1996 Archived April 5, 2009, at the Wayback Machine.
  2. ^ a b Sider, Don. "The Terminator" November 25, 1996
  3. ^ 'Creating Value through Corporate Restructuring: Case Studies in Bankruptcies, Buyouts, and Breakups'. Stuart C Gilson. Wiley Finance 2007
  4. ^ Norris, Floyd. "The Incomplete Resume". The New York Times, 2001-07-16.
  5. ^
  6. ^ 'The Price of Fortune: The untold story of being James Packer'. Damon Kitney. Harper Collins 2018
  7. ^
  8. ^
  9. ^ Norris, Floyd. Will Justice Department Go After Dunlap? The New York Times, 2002-09-06.
  10. ^ a b SEC complaint against Dunlap
  11. ^ a b c Sunbeam Corporation: “Chainsaw Al,” Greed, and Recovery Archived 2013-11-27 at the Wayback Machine., Daniels Fund Ethics Initiative
  12. ^ Gallagher, Bill. "Once a Bum, Always a Bum". Niagara Falls Reporter. Retrieved 29 June 2013.
  13. ^ Norris, Floyd. Will Justice Department Go After Dunlap? The New York Times, 2002-09-06.
  14. ^ Norris, Floyd (20 May 2005). "At Sunbeam, Big Guys Won, Public Lost". The New York Times. Retrieved 29 June 2013..
  15. ^ Deutschmann, Alan (1 July 2005). "Is Your Boss a Psychopath". Fast Company. Retrieved 29 June 2013.
  16. ^ John A. Byrne (July 1, 2005). "WORKING FOR THE BOSS FROM HELL". Fast Company.
  17. ^ 'The Psychopath Test '. Jon Ronson. Picador 2011
  18. ^ Urstadt, Bryant (21 July 2011). "The Stack: The Psychopath Test by Jon Ronson". Businessweek. Retrieved 29 June 2013.
  19. ^ Rob Walker (April 22, 2009). "Dunlap Profile". Upstart Business Journal.
  20. ^ "Portfolio's Worst American CEOs of All Time". CNBC. Retrieved July 16, 2015.
  21. ^
  22. ^ The Mayfair Set
  23. ^ "Titans of Finance: True Tales of Money & Business"., Inc. 2007. Retrieved 2007-12-10.
  24. ^ McGeehan, Patrick (2001-06-03). "Private Sector; Dumbed Down on Wall St.: Junk Finance, With Pictures". The New York Times Company. Retrieved 2007-12-10.

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