Michael I. Monus
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Michael I. "Mickey" Monus (born in 1947 in Youngstown, Ohio) is the former president of Phar-Mor, Inc., a defunct discount drug chain that established a strong national presence before declaring bankruptcy in the early 1990s.[1] Accused of perpetrating a $350 million fraud and embezzlement scheme, Monus was fired from the company and faced criminal charges.[2]
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[edit] Early years
Monus was born into a prominent family on the north side of Youngstown, Ohio.[1] He attended a preparatory school and later graduated from Babson College, in Wellesley, Massachusetts.[1] Monus returned to Youngstown, where he worked for a family business.[1] His return coincided with the collapse of the community's core steel industry, and Monus became intrigued with the possibility of launching a retail enterprise whose operations stretched beyond the borders of his hometown.[1] With business partner David Shapira, Monus launched a "deep discount" drugstore, whose strategy of aggressive buying provided customers with tremendous savings, if fewer selections.[1]
[edit] Birth of Phar-Mor
With startup money provided by Giant Eagle, Inc., the company in which Shapira's family members were large shareholders, the Phar-Mor discount drug chain became enormously successful.[1] In 1988, the chain featured 100 stores, and Monus was described in the media as one of the nation's leading entrepreneurs.[1] In an effort to revitalize his hometown's deteriorating retail district, Monus located the company's national headquarters in a remodeled former department store in downtown Youngstown.[1] A notoriously tough negotiator, he was able to keep retail prices low; and by 1991, there were 200 Phar-Mor outlets across the country.[1]
Amid this success, however, Monus began to show signs of becoming overextended. Phar-Mor stores expanded into new lines, including sportswear. Meanwhile, Monus' decision to sponsor a basketball league placed severe financial pressure on the corporation.[1]
[edit] Dissolution
In July 1994, board members of Phar-Mor, Inc., alleged that financial books stored at the corporate headquarters showed that the company had inflated its profits by huge margins.[1] Court documents also indicated that Monus had embezzled about $10 million from the company, mainly to support his beleaguered World Basketball League.[1] Monus' business partner, David Shapira, contacted federal agents, notified investors, and fired Monus, along with Phar-Mor's chief financial officer Patrick Finn.[1][3] Unsecured claims against Monus totaled $4,104,121, while secured claims were calculated at $15,257,545.[4]
The subsequent collapse of the discount chain not only marked the end of Monus' tenure as a leading entrepreneur; it disillusioned residents of his hometown, who were still coping with the loss of the community's steel-manufacturing sector.[1]
[edit] References
- ^ a b c d e f g h i j k l m n o Solomon, Jolie. "Mickey's Secret Life: The mystery man behind the Phar-Mor scandal was obsessed with winning–and lost big", Newsweek, August 31, 1992, pp. 70–72.
- ^ "Fired Phar-Mor chief Monus files for divorce, seeks house", The Vindicator, December 20, 1994, p. B-1.
- ^ "Monus files for personal bankruptcy", The Vindicator, September 26, 1992, p. 1.
- ^ Stapleton, M. A. "Filings show Monus is worth $2.9 million", The Vindicator, November 24, 1992, p. 1.