Head of Anheuser-Busch’s Beer Subsidiary Resigns as Financial Scandal Spreads

Brewing giant Anheuser-Busch on Wednesday accepted the resignation of top executive Dennis P. Long, as a financial scandal spread into the company’s highest ranks.

Anheuser-Busch Chairman August A. Busch III described Long, 51, as “my closest business associate and friend for the past 25 years.” Long was the president of Anheuser-Busch’s brewing unit and one of a half-dozen top officials of the parent company.

Earlier this month, St. Louis-based Anheuser-Busch fired three executives who were alleged to have been involved in improper financial dealings with an outside advertising agency.

Long said Wednesday: “As president of Anheuser-Busch Inc., I assume full responsibility for the actions of its officers and employees and have chosen to resign in the best interest of the company.”

Anheuser-Busch is the nation’s largest brewer, controlling 38% of the U.S. beer market. Its sales last year were $8.4 billion. The company is also the 10th-largest advertiser in the United States, with a 1985 advertising and promotion budget of $523 million.

Three Executives Fired

Two weeks ago, Anheuser-Busch said it fired three marketing executives reported to be the targets of a company investigation into financial abuses. The company has not, however, confirmed that the three executives were suspected of wrongdoing or that they had been dismissed as a result of the investigation.

The three executives were Joseph Martino, vice president of sales; Michael Orloff, vice president of wholesale operations, and John Lodge, manager of national sales promotion events.

At the time of the firings, Anheuser-Busch said only that it was “conducting an internal investigation into allegations of improper conduct by certain employees and suppliers.”

According to an account published in the St. Louis Post-Dispatch, the advertising agency involved was the Hanley Partnership, which is currently in bankruptcy proceedings.

Hanley had been paid in the early 1980s to handle some of Anheuser-Busch’s advertising and promotion for Budweiser, Eagle Snacks and other products. The relationship ended in 1983 when Hanley filed for bankruptcy court protection.

In a series of suits filed last year against former Hanley officers, the court-appointed trustee for the agency alleged that millions of dollars had been siphoned from the agency shortly before it closed, the Post-Dispatch reported.

The trustee, Gerald A. Rimmel, charged in one suit he filed last year that Hanley had paid $13,000 to help buy a Porsche automobile for one of the Anheuser-Busch executives fired last month.

In bankruptcy court proceedings last year, a former Hanley agency official testified that he heard second-hand of substantial cash payments--in one case, $250,000--from Hanley officials to Anheuser-Busch executives.

Long will leave his post as president of the company’s brewing subsidiary immediately, a company spokesman said. He will step down from his position as vice president and group executive of the parent company, Anheuser-Busch Cos., this summer.

Busch, great-grandson of the company’s founder, will assume Long’s former title of president of the brewing subsidiary, the company said.

“His advice and counsel have been invaluable,” Busch said in a statement. “Denny is one of the finest business executives I know.”

Long will remain affiliated with the company as an outside consultant, Busch said.