Philip Milne: Another well-paid victim of the mortgage crisis

You might view Philip Milne as one of the many casualties of the current financial crunch, another top exec who lost his job because of his company’s disastrous investments in subprime mortgages.

Take a look at his severance package, however, and you see the silver lining in Milne’s clouded career.

Milne resigned last week as chairman, president and CEO of Minneapolis-based Moneygram International (NYSE:MGI), a company best known for check and money-order services. He had been with the firm since 1991, rising through the ranks to become president and CEO in 2004. He was named chairman in January 2007.

Moneygram’s investments in recent years have gone well beyond financial transfers. The firm has lost about $1.6 billion in the mortgage market.

To stanch the bleeding, the company sold a majority stake to Thomas H. Lee Partners and Goldman Sachs Group in March. Most of the directors resigned at the completion of the deal, and Lee Partners put two of its managing directors on the board.

Shareholders have filed several suits against Moneygram, and the Securities and Exchange Commission is investigating its financial reporting.

Yet despite all the upheaval, Milne can enjoy a comfortable retirement.

According to an SEC filing last week, his farewell paycheck totals $9.7 million, including more than $2 million in salary, $7.5 million in bonuses and $205,000 in lieu of vacation pay.

The package should help make up for the plummeting value of his stock holdings. Last July, when Moneygram was trading at more than $30 per share, his stake was worth than $4 million. Yesterday, the stock closed at $1.01 per share.

Milne’s good fortune isn’t an isolated case. House Oversight and Government Reform Chairman Henry Waxman held hearings in March examining the multi-million-dollar pay of executives heading companies suffering major losses through subprime mortgage investments.

Waxman’s focus then was Countrywide Financial Corporation, Merrill Lynch and Citigroup.

Former Merrill chairman & CEO E. Stanley O’Neal left with a $161 million retirement package; former Citigroup chief Charles O. Prince III received $40 million in bonuses, stock options and perqs; and Countrywide’s Angelo Mozilo was paid more than $120 million in compensation and stock.

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