A 34-year-old former executive at Cook Industries Inc. denied last week that speculative commodity trading operations during the past year were completed without the knowledge of Cook's top command.
Christopher R. Parrott, former executive vice president and assistant director of Cook's bread-and-butter Agri-products Group, disputed company statements that top officers were uninformed about commodity trading positions which led, in part to more than $87.4 million in losses during the past year.
Parrott's resignation was accomplained by the resignation of his immediate supervisor, Willard Sparks, 38, senior executive vice president.
E.W. "Ned" Cook, chairman of the board and chief executive officer, has taken personal control of the Agri-Products Group.
"I kept my proper supervisors at Cook fully informed at all times on all commodity positions as I knew them," Parrott said last Thursday. "I cannot speak for others."
Cook had substantial profits from 1972 to 1975 when the volume and price of grain shipped overseas increased rapidly. The company's pre-tax profits rose from $4 million in 1972 to almost $40 million in 1973. The next year they reached $75 million.
One secret of Cook's success was its rapport with senior Soveit grain buying officials who purchased 40 million tons of grain from the United States starting in 1972.
However, Cook's position as the only major grain trading house with public stockholdings to account to puts the firm at a disadvantage. Some of Cook's privately owned competitors reportedly have experienced similar difficulties recently but only Cook has had to report its losses publicly.
Cook, himself, has made to secret of his desire for the firm to become privately owned as it once was, but plans to repurchase stock owned by members of the public have been postponed indefinitely because of the present financial difficulties.
The firm's futurn has been further clouded by several damage suits connected with the grain inspection fraud exposed in 1975 and 1976. Cook and most of the other exporters were found guilty of short weighting grain shipments to customers overseas. The U.S. government has sued Cook for $24 million, the alleged value of federally-financed grain shipments short-weighted by Cook.
Parrott declined comment when asked if he was being made a scape-goat of speculative trading transacted under company directive.
Asked about a company statement that said trading positions "inconsistent with company policies" were responsible, in part, for a projected $60 million fourth quarter deficit, Parrott told UPI: "I don't know how that could be possible. I think it's interesting they say that."
The former $388,344 a-year company officer said he resigned for "strictly personal reasons."
"I'm disappointed (about recent Cook developments) and I'm looking forward to the future rather than the past," said Parrott, who was recruited by Cook during the boom years of the late 1960s and early 1970s.
Parrott's progress at Cook had been rapid. He joined the firm as a commodities merchandiser in 1967 and quickly moved up the company hierarchy.
The young executive said he felt compelled to make a statement defending his work at Cook.
"I think it is important to understand that my decision to resign from Cook Industries was a voluntary one," he said. "At the time of my resignation, Mr. Cook indicated he accepted this decision with considerable reluntance."
Parrott said his future plans are uncertain.
Other Cook executives declined comment on recent developments at the financially troubled company.
An independent member of the Cook board of directors characterized the large annual and quarterly loss as "horrendous."
"This is just a horrendous loss, the kind you just can't afford," said J. Stuart Hunt, chairman of the Tribal Corp. in Dallas.
He said Parrott and Sparks "were trading with large limits beyond the company's restrictions."
Cook company stock trading on the American Stock Exchange has remained halted for seven trading days.
Hunt said the Cook board has moved to impose limits on speculative trading.
Cook losses for the quarter, which ended last Tuesday, leave the company with 20 per cent of the working capital it has last year and half its owner's equity.
The company is forced by the losses to curtail grain trading operations, sell off facilities unneeded for a smaller operation and reduce its world-wide work force.