Execs Flee GLD – The Revolving Door At The SPDR Gold Trust Sponsor

A remarkable but little noticed development has occurred behind the scenes of the SPDR Gold Trust (GLD) over the last 3 years. This development concerns the very high level of executive staff turnover at World Gold Trust Services, the New York based ‘Sponsor’ of the mammoth gold GLD gold-backed Exchange Traded Fund that is listed on the NYSE.

By Ronan Manly (BullionStar.com)

…Within the space of less than 3 years, World Gold Trust Services has gone through 4 Chief Executive Officers (CEOs) and 3 Chief Financial Officers (CFOs). By any standard this is a…[large number] of senior executives moving through the roles, and would normally ring alarm bells in the corporate governance departments of major institutional investors. Perhaps it has caused concern among institutional investors of the SPDR Gold Trust (GLD), but if it has, it has gone unreported.

New York based World Gold Trust Services (WGTS) LLC is a fully owned subsidiary of the London-based World Gold Council. WGTS is a Delaware registered limited liability company (for-profit) established in 2003 by the World Gold Council and run out of offices at 685 Third Avenue, in midtown Manhattan, New York. The World Gold Council (WGC) itself is a non-profit association registered in Geneva under Swiss Civil Code Article 60. So the structure of the relationship is a non-profit organization, the World Gold Council, owning 100% of a for-profit company, World Gold Trust Services.

In summary, here are the lists of CEOs and CFOs of World Gold Trust Services between 2013- 2016:

Chief Executive Officers (CEOs) of WGTS

• Jason Toussaint: April 2009 – left July 2013
• Kevin Feldman: Appointed June 2013 – Resigned 31^st July 2014
• Aram Shishmanian (acting): 31^st July 2014 to 8 September 2014
• William Rhind : Appointed 8^th Sept 2014 – Resigned  9 February 2016
• Aram Shishmanian (appointed): 10 February 2016

Chief Financial Officers (CFOs) of WGTS

• Robin Lee : H1 2010 – Left WGTS / WGC December 2014
• Adrian Pound: Appointed Oct 2013– Resigned 10 March 2015
• Samantha McDonald: Appointed March 2015

Last In First Out

On 10th February 2016, the SPDR Gold Trust filed a form 8-K with the US Securities and Exchange Commission (SEC) informing the market that WGTS CEO William Rhind had resigned, effective 12 February. The filing stated that:

“Mr. Rhind’s resignation was a personal decision and was not as a result of any CEO or WGTS performance-related issue or any other matters related to the operations, policies or practices of the Trust.”

On the same day, the board of WGTS (about which more below) appointed Aram Shishmanian, CEO of the World Gold Council, as CEO of WGTS, meaning that Mr Shishmanian is now CEO of both entities:

“On February 10, 2016, the Board of Directors of WGTS appointed Aram Shishmanian, Executive Director of WGTS, as the Chief Executive Officer of WGTS.”

William Rhind had only been appointed CEO of WGTS on 8 September 2014, and so was CEO for a relatively short period of 17 months. Rhind’s departure looked to be sudden, since more than a month later in March 2016, the SEC was still addressing a letter to Mr Rhind even though he had departed.

Rewinding further, William Rhind had been appointed CEO of WGTS because the former CEO Kevin Feldman had himself resigned, on 31 July 2014, effective 15 August 2014. This too seemed to be a sudden departure because on 31 July 2014, the board had to make Aram Shishmanian “Acting Chief Executive Officer”, suggesting that the Board did not have the time to line up a successor or to run a search campaign.  Shishmanian’s Acting CEO position lasted nearly a month until Rhind’s appointment in September 2014.

In its form 8-K filing with the SEC detailing Kevin Feldman’s resignation, the SPDR Gold Trust statement says that:

“Mr. Feldman’s resignation was a personal decision and was not as a result of any CEO or WGTS performance-related issue or any other matters related to the operations, policies or practices of the Trust.”