Tags: Sokol | SEC | rips | Buffett

Former Protégé Sokol Rips Buffett: His Judgment Day ‘Rapidly Approaching’

Monday, 07 Jan 2013 09:42 AM

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Former Berkshire Hathaway executive David Sokol offered a strong tongue lashing to his former mentor Warren Buffett, after the Securities and Exchange Commission decided not to take action against him for allegations of insider trading.

Sokol told The Wall Street Journal that "he will never understand why Mr. Buffett chose to hurt my family ... but given that he is rapidly approaching his judgement [sic] day, I will leave his verdict to a higher power."

Sokol was the Berkshire subsidiary executive who many considered to be a front-runner to replace Buffett as CEO. In 2011, Sokol resigned in the wake of what appeared to be an insider trading scandal. Sokol bought shares in Lubrizol, a chemicals company, The Journal reported.

Editor's Note: The Truth About the Economy — Government Documents Lead to Eerie Conclusion

Not long afterward, Sokol recommended to Buffett, 82, that Berkshire purchase Lubrizol. A few months later, in March of 2011, Berkshire indeed agreed to buy it, giving Sokol’s position a $3 million lift.

Buffett’s underling resigned after his purchases were disclosed, and at first, Buffett defended him. But several weeks after the resignation, Buffett lambasted Sokol, calling his conduct “inexcusable."

Sokol's remarks were his first public comments about the matter since being criticized by Buffett at Berkshire's 2011 annual meeting. Buffett declined to comment on Friday, The Journal reported.

Sokol's lawyer told Reuters Thursday that he was informed that the SEC wouldn't take action against his client.

In an email to The Journal on Friday, Sokol said that he was pleased with the SEC's decision and felt it was anticlimactic given that he has always maintained he did nothing wrong.

Sokol also vented to Fox Business Network.

“The only mistake I made is that I should have resigned two years earlier than I did. I tried to but Warren talked me out of it,” he said.

“I haven’t spoken to Warren and I don’t want to,” he told the network. “The notion that I violated some company policy is absurd. Warren always said to me, ‘Take the opportunity to invest your own money, and if you ever see something you really like, I’ll take a look at it.’”

Editor's Note: The Truth About the Economy — Government Documents Lead to Eerie Conclusion

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