The document summarizes a scandal involving the CEO of Metra, the commuter rail system for Chicago. In 2013, CEO Alex Clifford was fired and paid a $700,000 severance settlement that included a confidentiality agreement. This led to accusations that it was "hush money" and a misuse of taxpayer funds. An investigation found that politicians had tried to influence Metra's employment decisions. The media and public were highly critical of Metra and politicians over the scandal.

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Metra CEO Severance Scandal
Sheryl Fender

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Background

Regional Transportation Authority (RTA) created in 1974 and
now oversees the CTA, Metra, and Pace

Metra is the entire rail system

Metra owns and operates all but five of the rail lines in the
Chicago area
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Metra controls fares, services and staffing on those five

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Background

April 2013: CEO Alex Clifford releases internal memo accusing
Metra of pushing him out of a job because he refused to
cooperate with politicians trying to dictate employment terms at
Metra.
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July 2013: Clifford fired and paid a severance settlement
amounting to more than $700,000.
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Severance settlement included a strict confidentiality
agreement.
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People called it “hush money”, RTA accused Metra of
mishandling taxpayer money, and five board members
resigned.

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Organizational Response
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Metra stayed basically silent because of confidentiality agreement.
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Metra blamed “bad counsel” for the decision to pay the severance
settlement instead of using whistleblower insurance.
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Metra website has five articles in the Newsroom that make subtle
references to scandal, but do not truly discuss it or take
responsibility.
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Metra gave the Clifford memo to RTA and the House Mass Transit
Committee
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Metra asked former Assistant U.S. Attorney to investigate. He said
no due to conflict of interests.
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Metra brought in an interim CEO and shifted legal assignments to
in-house lawyers

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Media Response
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News articles had strong negative connotations.
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Media was negative toward Metra, the involved politicians and
the individual Metra employees.

One article pointed out a similarity to a Lake County case
where a CEO received $122,000 and a board member called
for an investigation.

CEOs receiving severance as “hush money” do not seem to
exist.
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RTA was the only party to receive slightly positive coverage
because it accused Metra of not properly handling taxpayer
money.

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Stakeholder Response
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RTA audited the situation and accused Metra of misleading the
public and misusing taxpayer money.
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Reboot Illinois decried the situation but praised the “active
citizenry”.
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U.S. Rep. Bobby Rush stated at a news conference that he had
no interference in Metra hiring practices.
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Politicians called for increased oversight and an investigation.
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Comments on news articles indicate disbelief about getting
paid that much when fired, sarcasm about corruption in
Chicago politics, and insults to Metra as a whole.

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Recommendations
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Metra should be transparent.
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Metra should limit confidentiality agreements.
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Metra should take responsibility and apologize, rather than
shifting the blame to “bad counsel”.
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Metra should educate their employees and board members on
the company’s ethics statement.
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Metra should make sure employees know that illegal or
inappropriate business or political involvement will not be
tolerated.