How Glenn Rufrano Became CRE’s Turnaround Specialist
June 26, 2019 | realestate.10ztalk.com
When Glenn Rufrano assumed the CEO post at American Realty Capital Properties on April Fools’ Day in 2015, the net lease REIT had barely begun digging its way out of an accounting scandal.
The scandal triggered the departures in late 2014 of co-founder and Chairman Nick Schorsch; CEO David Kay; Lisa Beeson, president and chief operating officer; and Lisa McAlister, chief accounting officer. It also marked the beginning of the downfall of Schorsch’s REIT empire, of which American Realty Capital Properties was just one piece. In addition, the corporate catastrophe led to an 18-month prison sentence in 2017 for the REIT’s chief financial officer, Brian Block, who was convicted of securities fraud tied to accounting irregularities that had surfaced in October 2014.
As of April 2019, VEREIT, the REIT that arose from the ashes of American Realty Capital Properties, had reached shareholder settlements totaling $245.4 million related to the accounting scandal. However, VEREIT hasn’t put the American Realty Capital Properties era completely behind it. A federal trial is set to start Jan. 21, 2020 in a class-action case brought by American Realty Capital Properties shareholders—notably financial services giant TIAA—who opted out of the settlements. “Litigation remains our last major legacy issue,” Rufrano wrote in VEREIT’s 2018 annual report.
