Head of E. F. Hutton & Co.
Fomon joined E. F. Hutton in 1951, eventually rising to head of
corporate finance. In 1970, he was named chairman and CEO of Hutton as a compromise candidate and relocated to its headquarters in
Manhattan,
New York. During his tenure, Fomon oversaw the sale of Hutton shares to the public and listing on the New York Stock exchange, and the creation of its famous advertising slogan, "When E. F. Hutton talks, people listen." The May 6, 1987
New York Times wrote that his leadership "helped build the retail-oriented brokerage house into one of the industry's most successful during a difficult era on
Wall Street." Robert Fomon also recognized the potential dangers of
mergers in the financial industry and advised the
Republican administration of
President Nixon that he believed there was a fundamental
conflict of interest in the case of
money management firms and
brokerage houses and the two should operate as independent entities.
Business scandal and resignation In 1984 the
United States Attorney for the Middle District of Pennsylvania opened a federal criminal probe into an E. F. Hutton check-overdrafting scheme that operated between 1980 and 1982 and which earned the company millions of dollars in illegal gains. As a result, the company's reputation was severely tarnished and it began losing clients which quickly led to financial difficulties. In December 1986, the company pleaded guilty to 2,000 felony counts, but neither Robert Fomon or any Hutton executives were charged. In early 1987, Hutton's
Board of Directors forced Robert Fomon to step down as head of the company. E. F. Hutton & Co. never recovered from the damage the scandal caused and in 1988 it was acquired by
Shearson Lehman Brothers . Robert Fomon died following a
heart attack at a
Palm Beach, Florida, hospital on May 31, 2000, at age seventy-five. ==References==