Shares of First Marblehead were tanking Wednesday, a day after a gift-giving scandal claimed the scalp of the company's chairman and CEO.
The educational lender stunned Wall Street after the close of trading Tuesday with the disclosure that Daniel Meyers had resigned over allegations that "he had exchanged gifts with a former employee of a major client of the firm."
First Marblehead's stock was down $5.01, or 18.7%, to $21.79.
Meyers, who had been with First Marblehead since co-founding the firm in 1991, told the lender's board that he had paid for the gifts with his own money. The gifts given by Meyers were worth about $32,000.
The Boston-based company did not disclose the identity of the client. The company said that Jack L. Kopnisky, the current president and chief operating officer, would replace Meyers and that CEO. William R. Berkley will serve as interim chairman.
In August, First Marblehead announced that it would serve as the exclusive provider of private direct-to-consumer student loan products for
, a division of
. In its annual report, First Marblehead listed
J.P. Morgan Chase
Bank of America
and Charter One as "significant customers."
In April, the company's shares were hit hard after First Marblehead offered less-detailed earnings guidance than it had in the past.