“The Fixer”
Welcome to The Fixer, a weekly newsletter from The WayFinders Group.
You could be making headlines for all the wrong reasons, but it may not happen to you, because you’re here learning from other leaders’ spectacular missteps. Every Friday, we forensically examine the corporate crises that could have been avoided with foresight, fresh thinking, and a phone call to the right people (aka us!). We also provide the next installment of our agony aunt column, and an opportunity for reader participation with our latest poll.
FRIDAY FIASCO: some questions are always worth asking
Patrick James, the publicity-shy founder of First Brands Group, has resigned as chief executive of the bankrupt auto parts maker. The company employs 26,000 people, generated more than $5bn in sales last year, and collapsed last month under nearly $12bn of debt and byzantine off-balance sheet financing structures now under Department of Justice investigation.
Charles Moore from turnaround firm Alvarez & Marsal has stepped in as interim CEO. Billions have been wiped off debt value, hitting investors including PGIM, CIFC, and Blackstone. The collapse came when funding partners finally stopped extending credit, not because of tariffs, but because they finally connected decades of failed businesses, fraud allegations, and defaulted debts to Patrick James.
Due diligence means googling the founder.
The real scandal isn’t byzantine financing or $12bn debt. According to an FT long read, James had a string of failed businesses and lawsuits going back to the 2000s, and Wall Street still wired him billions. In 2005, Worthington Steel accused him of ordering employees to shred documents. In 2009, a lender claimed he paid himself management fees after his business had “already shut down.” In 2011, he was accused of creating a “web of companies” to defraud creditors. He settled everything and moved on.
The article explains that Local Ohio banks put him through what one executive called a “colonoscopy” before refusing to lend. But when private credit boomed in the 2010s, new lenders handed him billions with “cursory checks.” His brother Ed reportedly told one potential lender: “We don’t let lenders into the warehouse.” When another asked about margins far exceeding competitors, they got “unsatisfactory answers.” Meanwhile, James amassed Malibu mansions, Hamptons estates, Ohio farms with prize horses, and a private security team. He built a chapel on his estate. He apparently employed professionals to scrub his photos and information from the internet. By summer 2025, when Jefferies tried to refinance with a $6bn deal, investors finally grew wary.
What was happening behind the scenes? First Brands had missed hundreds of millions in interest payments. Days after bankruptcy, a lawyer asked how much of nearly $2bn from invoice lenders remained in a supposedly segregated account. The response: “$0.” JP Morgan said the first principle of credit was “character.” Blackstone, PGIM, CIFC, UBS, Jefferies (firms that pride themselves on sophisticated risk management) all skipped this step. Jim Chanos, who predicted Enron’s collapse, is quoted saying First Brands exposed “the myth that private credit is a magical machine.”
What should have happened? Basic due diligence. Court record searches. Reference calls to Ohio banks who’d already walked away. Insisting on warehouse access. Better governance. A board that asked why a founder needed internet scrubbers. Any one of these steps would have revealed what was likely to happen next.
Our take? A difficult conversation in 2022 would have prevented bankruptcy, federal investigation, and billions in investor losses in 2025. But then again, who needs difficult conversations when we have Google.
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Face the facts
Have you ever ignored red flags in a business deal/partnership?
- yes, and I regret it
- yes, but it worked out fine
- no, I always walk away
- no, I Google first
- I’m ignoring some right now!
Fix me!
Dear Leah,
I’m Chief Operating Officer caught in the middle of a succession nightmare. Our CEO announced her retirement for next year, and immediately two internal candidates emerged – our Chief Financial Officer and our Chief Revenue Officer. Both are capable, but they’ve turned the leadership team into warring factions.
The CFO’s camp thinks the CRO is “all flash, no substance,” while the CRO’s supporters say the CFO “lacks vision and charisma.” Board meetings have become tense affairs where every decision gets filtered through succession politics. Last week, the CRO publicly undermined the CFO’s budget presentation, and the CFO responded by questioning the CRO’s client retention figures.
Our actual business is suffering because nobody wants to make decisions that might hurt their favourite candidate. The CEO seems paralysed by the conflict she’s created and keeps saying “may the best person win.”
How do I keep the company running while our leadership tears itself apart?
Dear Stuck in a C-Suite War,
Your CEO has accidentally turned succession planning into a reality TV show where everyone’s competing instead of collaborating. This is exactly how good companies destroy themselves during transitions.
READ MORE
Sometimes the best thing you can do is refuse to take sides in someone else’s game of thrones.
Fodder from the floor
“The truth is power and secrecy walk hand in hand. Power enjoys secrecy because it increases its scope…but here’s the thing about power and secrecy, if you can expose the secrecy, you might, you might, might break the power.” – Nick Davies, ITV’s The Hack (2025), played by David Tennant
