Pomerantz’s Director of Investigations Christopher Szechenyi manages a global team of investigators who are devoted to uncovering fraud, misleading statements, and other acts of misrepresentation by corporations and their officers. He and his team have conducted hundreds of witness interviews for the Firm’s securities fraud cases, which produced significant settlements for plaintiffs. Prior to his 20 years of experience as a private investigator, Chris served as a producer for Mike Wallace at 60 Minutes and learned his chops as a fearless, award-winning investigative reporter in Chicago.
Monitor: Can you share your journey from community newspaper reporter to Mike Wallace’s producer at 60 Minutes?
Christopher Szechenyi: My first beat as a newspaper reporter was covering science, medicine and health care. At the Columbia Daily Tribune, I co-wrote a three-part series, called “Public Trust, Private Profits,” about the county hospital’s publicly elected board of trustees, who were feathering their own nests in secret, sending the hospital’s business to their own private companies without any public bids or public knowledge. It led to the resignation of the hospital administrator and an outside company taking over the day-to-day operations of the hospital. After that I became a full-time investigative reporter and editor in Chicago, where I exposed a group of construction companies that were sending their employees sixty stories underground without testing the air for noxious gases, without ventilating the shafts or the giant sewer tunnel they were building, and without equipping the men with ventilators and gas masks. The repeated pattern of safety violations by the same companies led to the deaths of ten people. OSHA fined these companies as little as a dollar for killing a worker. They were never charged criminally. None of this had come to light before. The newspaper series won a national award for investigative reporting and prompted changes on a national level. It also caught the eye of other journalists, including those at the CBS station in Minneapolis. My first story there – based on lawsuits and disciplinary records – revealed that a small group of police officers, nicknamed “thumpers,” had repeatedly beaten citizens in horrific ways. In 1993, I landed an incredible job in Paris as a producer for Mike Wallace on 60 Minutes, one of the best jobs in journalism. Of all the stories, I am most proud of one where I obtained the confidential audits of the United Nations about tens of millions of dollars of waste and fraud at the UN. It took a week to cultivate the source who had the audits and dropped them off with my hotel’s concierge hotel in a brown paper envelope to remain anonymous.
M: What led you from journalism into investigations?
CS: Curiosity is the main motivating factor in both journalism and private investigations. They both consist of uncovering the unknown, finding the truth and exploring a world that we really know little about. From a young age growing up in New York City, my parents and grandparents, who were immigrants from Europe after the war, exposed me to many different cultures, people and places. My family gave me the ability to talk with anyone, and the kind of passion, persistence and empathy one needs to succeed as a journalist and as a private investigator.
During high school, I wanted to follow in the footsteps of Jacques Cousteau as an oceanographer. As a high school senior, I travelled aboard a ship from Woods Hole Oceanographic in Cape Cod to Bermuda aboard one of its research vessels. I traveled across the Indian Ocean, conducting research on ocean currents. That experience made me realize my strength was in translating the complexities of science into news and feature stories. I then made the jump from journalism in 2001 to a boutique law firm in Boston where I served as Director of Investigations. Another new world opened up – this time involving terms like channel stuffing and premature revenue recognition, and the financial frauds at Enron and Worldcom.
M: How did your experience at 60 Minutes prepare you for the work you do now?
CS: Mike Wallace set the pace for being passionate about his work, a characteristic I already shared. But this man, with whom I worked when he was 75 years old, never stopped working. Weekends, morning, noon and night. He loved his job. To succeed at 60 Minutes, it’s all about producing the best stories. You’re only as good as your last story and your next one. So that level of intensity is what I bring to this job as a private investigator every day. I place a high emphasis on productivity and consider each of the attorneys with whom I work to be my Mike Wallace.
The other aspect of working for 60 Minutes that contributes to my work today is the ability to develop contacts on a worldwide basis. Not only have I built a team of 10 outstanding investigators and researchers in the United States – the best in the business – whom I recruit, train, and coach on a daily basis, but I also call on investigators with whom I have built a relationship in London, Geneva, Hong Kong, Munich, Moscow and Mexico City to assist with Pomerantz’s international cases. One of those investigators happens to be Megan Wallace, Mike’s granddaughter.
M: What are you looking for when investigating a company for potential securities fraud violations?
CS: One word: scienter. We are looking for evidence that the individual defendants, usually the CEO and CFO, and senior management, knew about the fraud, directed it or ignored it. To derive that information, each interview we do with lower-level former employees adds a piece to the puzzle. The attorneys take our pieces – the memos we write – and put together the big, complete picture of the puzzle in a narrative.
M: Is there one investigation of which you are particularly proud?
CS: The CEO of Polycom had been fired for misusing the company’s funds, an unusual step for a publicly traded company. We investigated and learned he had his administrative assistant buy fancy Hermès ties for customers, but instead kept them for himself. It wasn’t enough to fire him, however. We also learned he was unfaithful to his wife. So, after thinking about who would really know the details about his financial shenanigans, I thought, “I bet his wife would know.” I called her up one weekend in a fancy ski town, and the first thing she said: “I am his ex-wife, and he is the biggest liar you will ever meet.” I asked her for details about his misspending and she gave me a prelude to what the SEC later charged him with: $80,000 for personal travel and entertainment (his ex- wife told me who charged the company for a trip to Bali, among other places); $10,000 for clothing and accessories; $5,000 for spa gift cards; and $10,000 for tickets to professional baseball and football games he falsely claimed to have attended with clients.
M: What is the biggest misunderstanding that people have about being an investigator?
CS: It’s not about hiding in the trees and taking pictures of cheating spouses, which by the way, I’ve never done. In this practice, it’s all about analyzing the case; figuring out who would be the best potential sources; finding their names, titles and phone numbers; and then calling them to talk in great detail, which requires a private investigator to earn their trust. It takes persistence, patience and the ability to connect with people in every corner of the world and in every industry on earth from mining diamonds to mining data.
