The business tragedy that Big Box retailer Bed Bath & Beyond has become has now taken a much darker turn: the company’s CFO apparently committed suicide one week after reportedly being sued for possible fraud involving BBB’s stock price.
Dailymail.com reported on Sunday afternoon that Gustavo Arnal (above), who according to press reports jumped to his death in Manhattan on Friday, was “being sued for allegedly inflating the Bed Bath & Beyond stock price in a ‘pump and dump’ scheme” that involved rogue investor Ryan Cohen.
According to the DailyMail.com report, which has not been confirmed by Bed Bath or any other independent sources, “Arnal, 52, is listed as one of the defendants in a class action lawsuit brought by a group of shareholders who claim they lost around $1.2 billion when Arnal and majority shareholder Ryan Cohen engaged in a ‘pump and dump’ scheme.”
The story goes on to report that “the lawsuit, filed in the United States District Court for the District of Columbia on August 23, claims Cohen had approached Arnal about a plan to control shares of Bed Bath and Beyond so they could both profit.”
Arnal’s family, Cohen and the district court could not be reached for comment for this story. Bed Bath & Beyond responded to a request for comment saying, “We will not comment on litigation and ask that you please respect Mr. Arnal’s family and their privacy at this time.”
Arnal is reported to have sold over 42,000 shares in the company two weeks ago, valued at $1 million, DailyMail.com reports, citing MarketBeat.com as the source.
Cohen, who had bought an approximately 10% share of the company earlier this year, vowing he was in it for the long run, subsequently sold his entire stake – including additional call options he had only filed days before – when the stock was near its $30 peak in August. It is believed Cohen, an investor who had previously speculated in shares of GameStop and has a huge following amongst meme-driven traders, made a significant profit on his BBB shares when he sold. The stock price closed on Friday at $8.63, down at least 40% over the previous five trading days.
Before news broke of the lawsuit, Bed Bath put out a statement on Arnal’s death, calling it a “shocking loss,” praising his efforts to help the financially troubled company. Arnal had been with BBB since May of 2020, part of the team assembled by former CEO Mark Tritton to lead a turnaround that subsequently failed. Prior to joining the retailer he had been with Avon and previously spent 20 years at Proctor & Gamble.
The DailyMail.com says the lawsuit was brought by Virginia resident Pengcheng Si “on behalf of all of those who purchased Bed & Bath & Beyond stocks between March 25 and August 18,” marking the approximate time that Cohen held his shares. The suit says that Arnal “agreed to regulate all insider sales” at BBB and also “issued materially misleading statements…regarding BBBY.”
Note: This story was updated at 5:24pm on Sunday with Bed Bath & Beyond’s response for comment.