Manager of bankruptcy drew millions since '87

ST. LOUIS -- The man who has managed one of the nation's largest insurance company bankruptcies apparently was paid more than $4 million in salary and $14 million in bonuses from 1987 to last May, the St. Louis Post-Dispatch reported Sunday.

J. Burleigh Arnold got that for presiding over the bankruptcy of Transit Casualty Insurance under a complex, 14-page contract interpreted for the Post-Dispatch by Peter Kerth, an area attorney specializing in reorganizations and bankruptcy law.

Under the deal, the newspaper said, Arnold got a yearly base salary of $350,000 and was provided $4,900 monthly to cover his home mortgage. For each paycheck, Arnold's employer put the equivalent of three more in an interest-bearing account to fund a bonus for him at the contract's end. And his employer will pay his health, dental and life insurance premiums for 10 years after the contract ends, the Post-Dispatch said.

"In the end, the question is how his compensation compares to that of his peers, and whether someone else could have achieved the same result for less money," Kerth said.

"Astounding," said Dick Darling, the International Association of Insurance Receivers' former president. "I've never heard of any kind of a deal like that."

Regardless, some say Arnold did a good job.

"Yes, it is a heck of a lot of money," said Dale Stephenson, president of the National Conference of Insurance Guaranty Funds. "Would I like it? Absolutely. Has Burleigh done the job of straightening up a mess that I wouldn't have bet on back then? He certainly has."