We know it's a bad bonus season on Wall Street, but one Morgan Stanley banker's refusal to pay a $300 cab fare may have gone a step too far.
The Connecticut Post reported today that William Bryan Jennings, who co-heads Morgan Stanley's division that issues new bonds to North American investors, allegedly stabbed a Middle Eastern cab driver with a pen knife after a dispute over a cab fare. This happened on Dec. 22, but the charges came down this week and Jennings will appear in court on March 7.
Here's what apparently happened:
Darien Lt. Ronald Bussell said the driver had made a complaint to police about 12:30 a.m. Dec. 22.
The man told police he had given Jennings a ride home to his $3.6 million Knollwood Lane home about midnight. The driver said Jennings refused to pay the $200 cab fare and became abusive, threatening him and using racial slurs, Bussell said.
The driver then drove with Jennings in the back seat to find a police officer to help settle the matter, Bussell said. When the driver put a hand through the cab's partition into the passenger compartment during the ride, Jennings stabbed the hand with a pen knife, Bussell said.
According to his profile, Jennings is a highly placed executive with Morgan Stanley.
Riccio said that his client came forward and fully cooperated with the police investigation.
"In our view, it was Mr. Jennings who was the subject of an abduction, and should be the victim in this case, not the defendant. He was the subject of an abduction," Riccio insisted.
Riccio said that when the cabbie pulled into the Knollwood driveway after giving Jennings a ride home from a charity event in New York, the cabbie actually demanded $300 -- an "exorbitant amount" for a ride home. When Jennings balked at the amount, the cabbie said he was going to take him back to the city, Riccio said.
Jennings was being whisked through the neighborhood while the cabbie ran stop signs and red lights, speeding toward the center of town, Riccio said.
Riccio said Jennings pulled out a pen knife he uses for fishing and demanded to be let out of the car because he was afraid. On the Post Road, the cabbie tried to get the knife from Jennings and was cut while putting his hands through the window, Riccio said, adding that Jennings did not intend to hurt the driver.
At that point, the cab stopped in front of the Darien Sport Shop near the Interstate 95 entrance and Jennings jumped out, Riccio said.
First, let's get the obvious out of the way: Jennings shares his names and his obsession with the value of paper currency with William Jennings Bryan, the American politician who gave the famous speech in 1896 against the gold standard, arguing that mankind should not be "crucified on a cross of gold."
This story also has many odd features. For one thing: the pen knife that Jennings said he kept on him for fishing. December 22 was a Tuesday, in the dead of winter; how much fishing did the besuited Jennings expect to do in Morgan Stanley's fixed-income department? Or had he heard about the dismal year for Wall Street bonuses coming up and armed himself against disgruntled bankers? We'll never know.
But the oddest of all is Jennings' failure to manage a simple financial transaction -- something that he was presumably paid to do every day in his job. As an investment banker, Jennings' entire career was based on negotiating the price of a company ahead of time and knowing the true value of everything from a bond to an entire company.
Jennings apparently failed to do his homework, which is easily Google-able. According to the World Taximeter, a handy if not bulletproof fare calculator, the fare between Morgan Stanley's headquarters and Jennings' home should be about $115, including the tip. It's a common, and fair practice among New York City cab drivers to double the amount when going outside of city limits, since they are coming back to the city with an empty cab and in this case, the ride back is a one hour and 14 minutes of lost wages to the cabbie. Cabbies also negotiate the price ahead of time for such trips.
Yet, here Jennings was apparently surprised by the $300 cost of the cab ride. Dealmaker strike 1. (He also apparently didn't look into taking one of Wall Street's famous "black cars," the town cars that the firm usually provides to its employees after a late night. With cost-cutting, the requirements on using those cars may be more stringent these days, but still: Dealmaker strike 1.5)
Then Jennings allegedly refused to pay the fare, while hurling slurs at the cab driver. This is not an elegant way to handle a failed price negotiation. One of the first rules of dealmaking is not to reject the offer and pout when you don't like it; you make a counter-offer. Refusing to pay is an immediate breakdown in the process, and hurling slurs puts the two sides in opposition. Dealmaker strike 2.
Jennings also maintained no leverage in the negotiation -- trapped in the backseat of a cab, he was not on his own turf and had no way to hold the upper hand or bring anything to the table. Instead, he used verbal and physical attacks to gain leverage. Dealmaker strike 3.
The other big, unsaid question is why a banker who makes millions of dollars a year would allow a dispute over $300 to devolve into violence; it's a sure bet that any banker has been at meals where the bottle of wine would cost that much; shared meals with executives and colleagues cost multiples of that. The average home in Darien lists for $1.9 million. And Jennings brokers deals worth billions of dollars every day. It's hard to see why such a relatively small sum of money would put him over the edge that way. There's no way to tell unless it comes out at the court date.
Jennings was put on leave from Morgan Stanley after he was charged; there's no way to know what will happen after that. But if he had applied some of his better Wall Street dealmaking tactics, he might have avoided such a dire outcome.
Update: On March 3, Bloomberg News updated the story with careful reporting that reveals more of the details of the case and makes Jennings' behavior look even more ill-considered and violent. This is how Bloomberg describes it:
Mohamed Ammar said the banker attacked him Dec. 22 with a 2½-inch blade and used racial slurs after a 40-mile ride from New York to the banker’s $3.4 million Darien, Connecticut home.
Jennings, who had attended a bank holiday party at a boutique hotel in Manhattan before hailing the cab, refused to pay the $204 fare upon arriving in his driveway, the driver said. When Ammar threatened to call the local police, Jennings said they wouldn’t do anything to help because he pays $10,000 in taxes, according to a report by the Darien police department.
Ammar, a native of Egypt, said he then backed out of the driveway to seek a police officer. The banker called him an expletive and said “I’m going to kill you. You should go back to your country,” according to the report, filed in state court in Stamford. A fight ensued as they drove through Darien, and Jennings, 45, allegedly cut Ammar, 44, police said.
Ammar told police Jennings flagged him down in front of Ink48, a hotel on Manhattan’s West Side. The hotel confirmed there was a Morgan Stanley party that night, which Jennings said he had went to following a charity event.
The banker appeared “drunk,” the driver said, according to court documents.
[Jennings] left the party sometime before 11 p.m. and headed to the street, where he was supposed to be met by a car service, Jennings said. He hailed Ammar’s cab after the livery car didn’t appear, according to the report.
Ammar said Jennings agreed on the fare and told him he would pay cash. Jennings fell asleep during the trip, the driver said. Once at the destination, though, Jennings said “he did not feel like paying” because he was already home, Ammar told police.
Ammar told officers Jennings threatened him, and that he feared for his safety. He backed out of the driveway with Jennings still in the cab. Ammar said he had tried to call 911 but was hampered by poor cellular reception in the wealthy Fairfield County suburb.
As he drove off, Ammar said, Jennings pulled the knife and began stabbing him through the open partition that divided the front and rear of the cab. Ammar said he tried to defend himself by using his right hand to block the opening, and then pulled over and dialed 911 again, as Jennings got out and fled, police said.
Jennings told Darien police the cab driver accidentally cut his hand while attempting to block the banker from calling the police himself on his cell phone, according to the report.....He then went on vacation to Florida, police said.
The entire Bloomberg story shows an excellent attention to facts and you should go over there and read it. It reveals many details that reveals Jennings' behavior to be not just bad dealmaking, but, as many responses on Twitter to the story show, downright repugnant.
The dealmaking violations add up: It goes without saying that reneging on a deal that was already struck - with no better excuse than "not feeling like paying" - is a surefire way to lose the trust of anyone, from cabbie to CEO. It turns out that there is a precedent for this; back in 2008, during the financial crisis when banks were finding it hard to stay afloat, they decided they wanted to renege on their financing promises for numerous giant deals, from the buyouts of Clear Channel Communications to Canada's BCE. Some of the buyers also walked away scot-free, as in the case of Blackstone Group's failed buyout of Alliance Data Systems.
Notably, the deals that survived that tough time did so because some bankers and executives decided to put away their egos. In the case of Clear Channel, then-CEO of Morgan Stanley John Mack decided to tamp down egos and fix the deal. Jennings, who must have overlapped with Mack during his long career at Morgan Stanley, might have taken some tips from the better banker.
Staying in control - or at least, losing control only if it's strategic - is a linchpin of Wall Street dealmaking. Jennings may be found innocent and avoid five years in prison - and somehow may return to Wall Street. Still, his actions here would cast significant doubts on his judgment in tense situations - and on Wall Street, there are never any other kind.