Aziz Not a Factor in C.T.O. Cut, Crypto Says

12 February 2009
After this article was published Wednesday, one comment from Javaid Aziz was added Thursday morning.

CryptoLogic Ltd. said Wednesday that its decision to cut the chief technology officer's post was not influenced by its former chief executive, who in December secured an activist shareholding and called for a leaner management team.

As part of the company's well-publicized restructuring plan, C.T.O. Michael Starzynksi was let go Monday evening. According to, Mr. Starzynski, 49, had been an officer with the company since 2003 and in 2007 was compensated $305,510 -- including salary, incentives and options.

Minus Mr. Starzynski, the company now retains three officers, five directors and one chairman. Brian H. Hadfield, its current chief executive, doubles as one of those directors.

Mr. Starzynksi's is the first management-level position to be cut. It is not clear, meanwhile, how many of the company's staff have been let go, but at third-quarter results time in November, Mr. Hadfield said on an earnings call that roughly 10 percent of its then 300 employees had been made redundant.

In filings with the United States Securities and Exchange Commission in early December, Javaid Aziz, Crypto's former chief executive, emerged an unambiguous critic of the company's performance in 2008 -- both internally and on the markets.

Mr. Aziz, whose London Stock Exchange shareholding rose to 10 percent last week, said in those S.E.C. filings specifically: "The senior management structure and cost needs to be reduced by 50%. The 'new' company cannot afford a CEO, CFO and CTO on their present compensation levels."

Mr. Aziz said that, post restructuring, a diagram of the company's manpower structure should resemble a pyramid and not a mushroom.

"I can definitely tell you that the [C.T.O. redundancy] was not in response to Mr. Aziz's filings," Kyla Thoms, a spokeswoman for the company at Argyle Communications in Toronto, told IGamingNews Wednesday. "The decision to let Michael go was in place before anything to do with Javaid's filing and goes along with the new growth strategy."

That strategy, an update on which was given in mid-January, calls for $13 million in operational cost savings to be achieved in 2009. Of those savings, $8.5 million are to be attained through employee cuts.

In an e-mail to IGamingNews Thursday morning, Mr. Aziz said of the move: "[It's] a good first step towards reducing costs and expenses to be in line with future assured revenues, and consistent with my requests in my letter to the Board of Cryptologic dated 9th January 2009."

Chris Krafcik is the editor of IGamingNews. He lives in St. Louis, Mo.