Albert J. Dunlap

Albert John Dunlap (July 26, 1937 – January 25, 2019) was an American corporate executive.

He was known at the peak of his career as a professional turnaround management specialist and downsizer.

The mass layoffs at his companies earned him the nicknames "Chainsaw Al" and "Rambo in Pinstripes", after he posed for a photo wearing an ammo belt across his chest.

It was later discovered that his reputed turnarounds were elaborate frauds and his career was ended after he engineered a massive accounting scandal at Sunbeam Products, now a division of Newell Brands, that forced the company into bankruptcy.

Dunlap is on the lists of "Worst CEOs of All Time" published by several business publications.

Fast Company noted that Dunlap "might score impressively on the Corporate Psychopathy checklist" and in an interview, Dunlap freely admitted to possessing many of the traits of a psychopath, but considered them positive traits such as leadership and decisiveness.

He was a major benefactor of Florida State University.

Dunlap was born in Hoboken, New Jersey in 1937.

He entered West Point in 1956 and graduated with a degree in engineering in 1960.

He then served in the United States Army for three years, qualifying as a paratrooper and being posted at a Nuclear Missile Site.

In 1963, Dunlap entered the business world at Kimberly-Clark as part of its manufacturing operations.

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.

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 non-existent sales — a situation similar to his later activities at Sunbeam.

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.

Dunlap never mentioned Nitec on his resume, and the scandal was not widely known until reported by The New York Times after the revelation of his dishonesty at Sunbeam.

Dunlap maintained his innocence even after a Nitec vice president testified under oath that Dunlap had personally ordered him to report the misleading figures.

Lily Tulip Cup hired him as the president and CEO in 1983.

In 1985, he was given the additional title of chairman of the company.

From 1991 to 1993, he was CEO of the Australian firm Consolidated Press Holdings (CPH), a private company belonging to the Packer family, after Kerry Packer took a leave of absence for health reasons.

At the time, CPH had a diverse portfolio in media and publishing, as well as chemical and agricultural operations.

During his three years at the company, Dunlap mentored James Packer.

In 1994, Dunlap became the CEO of Scott Paper after Philip E. Lippincott stepped down from the position.

In 1995, he sold Scott Paper to Kimberly-Clark for $9 billion, making $100 million from the deal via stock options and the appreciation of his holdings.

Dunlap took over as chairman and CEO of Sunbeam in 1996.

His methods resulted in Sunbeam's reporting record earnings of $189 million in 1997.

However, he was unable to find a buyer by the end of the year.

On March 3, 1998, Sunbeam announced the acquisitions of camping gear maker Coleman Company, coffee machine maker Signature Brands (best known for making Mr. Coffee), and smoke detector maker First Alert.

Sunbeam’s stock rose 9% on the news; within two days, it jumped to an all-time high of $52 per share.

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.

When an analyst questioned Dunlap about the matter in May 1998, Dunlap reportedly grabbed him by the shoulder and said, "You son of a bitch. If you want to come after me, I'll come after you twice as hard."

In the second quarter of 1998, the Sunbeam board of directors investigated aggressive accounting practices and extreme discounting carried out at the direction of Dunlap.