Mike Jeffries was named "Worst CEO of the Year" and put on Cramer’s Wall of Shame in 2013 while working for Abercrombie & Fitch
Former Abercrombie & Fitch CEO Mike Jeffries was named the "Worst CEO of the Year" in 2013 by American journalist Herb Greenberg, reportedly for his company's poor performance. In November of the same year, Jeffries was also placed on CNBC's anchor Jim Cramer's "Wall of Shame," a roster spotlighting executives who have notably failed to meet expectations.
These titles gained renewed attention, as on October 22, 2024, when Mike Jeffries and his partner were arrested on alleged charges of s*x trafficking. PBS reported that the alleged crimes spanned from 2008 to 2015.
For the unversed, Michael Stanton Jeffries is an 80-year-old American businessman who was chairman and CEO of clothing retailer Abercrombie & Fitch from 1992 to 2014.
A look at Mike Jeffries' tenure as the "Worst CEO of 2013"
Herb Greenberg, the editor of Herb Greenberg's Reality Check, and a contributor to The Street, published an annual list of the worst CEOs of 2013, runners-up, and nominees.
According to Greenberg, the process of narrowing down the list of the worst CEOs each year causes him significant "anguish." He further explained that the selection was based on a thorough analysis of stock performance, combined with financial metrics.
"Every year I go through this exercise of trying to determine who should be the worst CEO, and who the runners-up should be, and every year I anguish over it. I screen for bad performers looking at stock prices overlaid with various financial metrics," Greenberg said.
He gave the title of "Worst CEO of the Year" (2013) to Mike Jeffries. The reasons were suggested that Abercrombie & Fitch was the only non-mining/natural resources company to land in the list of bottom 25 of the Standard & Poor's 500.
Furthermore, the reports by Greenberg indicated that during Jeffries's tenure, Abercrombie & Fitch had seven quarters with same-store sales experiencing a significant downturn in 2013. The overall revenues reportedly dropped by 11.7% last quarter, in stark contrast to the 8.7% increase seen during the same period in 2012.
Not only this, in November 2013, Mike Jeffries was also put on "Wall of Shame" by CNBC’s Mad Money host, Jim Cramer. According to him, Jeffries was credited with building Abercrombie & Fitch from "nothing" and transforming it into one of the "hottest brands of the 90s." However, Cramer further said that what ultimately mattered was Jeffries's long-term performance in the stock market.
Despite early success, Jeffries had reportedly failed to deliver consistent financial results, leading to his inclusion on Cramer's Wall of Shame:
"The stock market always wants to know, what have you done for me lately? And when it comes to Mike Jeffries, the answer is not much," Cramer said.
Cramer claimed that Abercrombie & Fitch overhyped in May 2013 about their first-quarter results. However, just a few months later, the company issued a disappointing earnings warning, indicating a clear disconnect from their earlier hype.
Former Abercrombie & Fitch CEO, Mike Jeffries, has not responded to the titles and claims yet.
Former Abercrombie & Fitch CEO Mike Jeffries arrested
On October 22, 2024, Mike Jeffries, partner Matthew Smith, and their employee James Jacobson were arrested under alleged s*x trafficking charges. PBC reported that Jeffries and Smith were arrested from Florida, whereas Jacobson was arrested from Wisconsin.
According to the indictment, Jeffries and his associates allegedly paid numerous men to engage in s*xual activities with him and others in the United States, as well as in various hotels across England, France, Italy, Morocco, and St. Barts.
The indictment also stated that the recruited individuals were often reportedly induced with drugs and provided with items such as lubricants, condoms, costumes, s*x toys, and, at times, erection-inducing injections that resulted in painful and prolonged reactions.
PBS further reported that the men were recruited from around the world with the promise of modeling opportunities within the clothing line.
An indictment unsealed in federal court in Brooklyn revealed that from 2008 to 2015, Jeffries, Smith, and Jacobson allegedly operated an international s*x trafficking business. This reportedly leveraged Jeffries' wealth and fame, fulfilling their desires while maintaining secrecy.
Mike Jeffries made a court appearance on Tuesday in West Palm Beach. His attorney, Brian Bieber, stated that they plan to respond to each allegation in detail, but will do so in court rather than through the media.