Frederick H. Joseph
|Died||November 27, 2009 (aged 72)|
|Residence||New York City|
|Alma mater||Harvard University (BA, 1959)|
Harvard Business School (MBA, 1963)
|Years active||1963-1990, 2001-2009|
|Employer||E. F. Hutton|
Shearson, Hammill & Co.
Drexel Burnham Lambert
Morgan Joseph & Co.
The Wall Street Journal noted that he was, "The son of an orthodox Jewish cab driver and a dental hygienist, Mr. Joseph was born in 1937 and grew up in Dorchester, Massachusetts". While at Harvard, Joseph won several Harvard Boxing Club medals.
In 1963, Joseph began his career in finance in the corporate finance department of E. F. Hutton working for John S.R. Shad. Following Shad's departure from Hutton, Joseph left the firm as well to join Shearson, Hammill & Co. By the early 1970s, Joseph was Shearson's chief operating officer, the number-two post in the firm. However, in 1974, Shearson was acquired by Hayden, Stone & Co. and Joseph left the firm to join Drexel Burnham Lambert as co-head of corporate finance. Although Drexel was only a second-tier firm at the time, Joseph had long wanted to get back into investment banking. He boldly promised that in 10 years, Drexel would be as powerful as Goldman Sachs. Although junk-bond chief Michael Milken was the most powerful man in the firm, it was Joseph who was named president in 1984 and CEO in 1985. By this time, Drexel had more than fulfilled his bold promise, and had grown to become the fifth-largest investment bank in the nation.
In 1988, Joseph was responsible for negotiating Drexel's settlement with the federal government, in which the firm entered an Alford plea to six felony counts and paid $650 million in fines and penalties—at the time, the largest fine ever imposed under the 1930s securities laws. In 1993, the SEC barred Joseph for life from serving as president, chairman or CEO of a securities firm for failing to properly supervise Milken. In 2009, Portfolio.com and CNBC named Joseph the seventh-worst CEO in American business history, stating that his over-reliance on Milken's junk-bond unit "left the company without a crisis plan."
In 2001, Joseph resurfaced on Wall Street, when he co-founded Morgan Joseph & Company, an investment banking firm that focuses on middle-market businesses. Although the firm carries his name and he was part-owner, he was only co-head of corporate finance as a result of the SEC's lifetime ban.
Joseph died on Friday, November 27, 2009 from complications of multiple myeloma.
- Fred Joseph, Who Led Drexel in Its Heyday, Dies at 72. New York Times, December 1, 2009
- Former Drexel CEO Dies at Age 72. The Wall Street Journal, November 30, 2009
- Frederick Harold Joseph; Body Blow to a Fighter. New York Times, December 23, 1988
- Drexel, Symbol of Wall St. Era, Is Dismantling; Bankruptcy Filed. New York Times, February 14, 1990
- Drexel Chief's Tough Task: To Regain Client Confidence. New York Times, April 5, 1989
- "Fred Joseph, Drexel Burnham Chief in Milken Years, Dies at 72". Bloomberg. November 30, 2009.
- Portfolio's Worst American CEOs of All Time - #7 Fred Joseph. CNBC, April 30, 2009
- BW Online | July 14, 2003 | Drexel's Ex-Chief Is Back in Business