Two former Prudential Investment Management execs have sued the firm in federal court for forcing them out after they complained that Prudential changed the investment objective for a number of municipal bond funds they managed without notifying the board or asking shareholders for their approval, the Newark Star-Ledger reports. The two are Robert Waas, a former managing director, and Robert Germano, a former senior portfolio manager.
Waas and Germano attest that senior management asked them to adopt a new mandate for the funds in April 2004 that changed the investment objective from tax-exempt income to price appreciation. They voiced their concern to their superiors, and Prudential then hired a law firm to investigate the matter. The law firm concluded that the funds’ investment objective had not been changed, but the report didn’t address the issue, the two executives said.
When Waas refused to certify the funds’ annual report in November 2004, he was fired. Germano said that relentless discrimination and retaliation caused him to resign in June 2005.