The curious case of Larry Fondren and DelphX
After a decade with DelphX Capital Markets, the company’s founder and executive chairman was unceremoniously fired “for cause” earlier this month. He still isn’t sure why.
On February 11, DelphX Capital Markets issued an announcement that its founder, Larry Fondren, had resigned from the company’s board of directors and had been terminated for cause from all of DelphX’s subsidiaries, including DelphX Services Corp. The news may have come as a shock to those who knew Fondren, a 50-year veteran of the insurance and fixed-income industries, but perhaps no one was more befuddled than Fondren, himself.
“It has recently been discovered by the Board that, contrary to fiduciary duties to the Company, Mr. Fondren has been using the Company’s property to advance his own personal interests,” the announcement read.
When I read that [announcement], I thought, ‘What the expletive is this?’
Larry Fondren
In an interview with WatersTechnology, Fondren denies that claim. “When I read that [announcement], I thought, ‘What the expletive is this?’ That is not what the [original resignation] documentation shows. This is certainly not what my understanding was. And this suggests that somehow I’m doing things that are untoward. That’s wrong,” he says.
He offers a timeline spanning almost two months that partially explains, in his view, how he may have ended up in this position. Fondren originally became the company’s executive chairman in April 2019, following the board’s decision to replace him as CEO with two co-CEOs. At a DelphX board meeting on December 31, Fondren says he offered his resignation, unprompted, to avoid the suggestion there was any conflict of interest with his other venture, Entre Global Services, the aim of which is to help institutional investors—primarily life insurance companies and pension funds—maximize their yields.
For contrast, DelphX Capital Markets is a platform focused on risk mitigation and providing an alternative securities-based solution for credit default swaps, through its “Delph” instrument. DelphX Services Corp., founded in 2006, is a Securities and Exchange Commission (SEC)-registered special-purpose broker-dealer and Finra member firm dedicated to operating the DelphX Alternative Trading System (ATS). Entre Global Services, founded in 2000 by Fondren, is also the founding corporate parent of DelphX, LLC, the original DelphX entity, he says. DelphX is listed on the TSX Venture Exchange in Canada under the ticker DELX.
When Fondren informed the board of his resignation, he says current DelphX CEO, Patrick Wood, who was appointed to the role in June 2020, asked Fondren if he would make his resignation effective on March 1. Fondren says he agreed. (Wood has not returned multiple requests for comment.)
Fondren says all seemed well until he received a letter from the board on February 11, confirming the board’s acceptance of his resignation, effective immediately, and termination of his position on the board and his position as the sole registered principal of the broker-dealer. He says the letter made no mention of wrongdoing by Fondren, but he was unable to share it with WatersTechnology, as it’s marked confidential.
“This is nuts. My reputation has been defamed,” Fondren says. “I mean, if there was documentation somehow that gave rise to this public announcement, that’d be one thing, but there’ isn’t—certainly not to my knowledge. I’ve never been presented with anything that supports what they said.”
It’s unclear whether the accusations levied at Fondren are financial in nature or related to intellectual property, but Fondren has retained counsel specializing in IP matters. No formal lawsuits have been filed by Fondren or the company against each other as of yet, he says.
“As far as I’m concerned, I continue to invent. That’s what I do,” Fondren says.
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@waterstechnology.com or view our subscription options here: http://subscriptions.waterstechnology.com/subscribe
You are currently unable to print this content. Please contact info@waterstechnology.com to find out more.
You are currently unable to copy this content. Please contact info@waterstechnology.com to find out more.
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Printing this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@waterstechnology.com
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Copying this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@waterstechnology.com
More on Emerging Technologies
This Week: SS&C unveils T+1 preparedness scorecard; S&P/DTCC; SmartStream & more
A summary of the latest financial technology news.
The bank quant who wants to stop genAI hallucinating
Former Wells Fargo model risk chief Agus Sudjianto thinks he has found a way to validate large language models.
Prepare now for the inevitable: T+1 isn’t just a US challenge
The DTCC’s Val Wotton believes that firms around the globe should view North America’s move to T+1 as an opportunity—because it’s inevitable.
Man Group’s proprietary data platform is a timesaver for quants
The investment firm’s head of data delves into its alt data strategy and use of AI tools to boost quant efficiency.
Waters Wavelength Podcast: An exploration of the DeFi world
Daniel Liebau from Lightbulb Capital joins the podcast and dives into DeFi.
Nasdaq CEO: GenAI ‘a whole new opportunity’
Nasdaq CEO Adena Friedman and other top execs outlined a range of use cases for generative AI and other emerging technologies during its Investor Day.
Native digital assets—a Kodak moment for financial services
Ian Hunt argues that ignoring a new business model for investment products, assets, transactions and asset servicing could sentence financial firms to the same fate as the fallen film photography giant.
This Week: Overbond, Northern Trust, FIS/Torstone, Trading Technologies, and more
A summary of the latest financial technology news.
Most read
- Women in Technology & Data Awards 2024: All the winners
- Man Group’s proprietary data platform is a timesaver for quants
- Dark horse: Deutsche Börse building dark pool