One of the unlikely heroes and later villains of the giant debt-funded boom of the 2000s was one-time wunderkind Jeremy Reid, the former head of hedge fund manager Everest Babcock & Brown. Reid, who had an estimated net worth of $200 million in 2007, yesterday officially left the executive suite of Everest, as the company returns $10 million to shareholders and winds down its operations.

However, despite presiding over a drop in the value of Everest from $300 million to $10 million, Reid isn’t departing the scene entirely — he is remaining an executive director of Everest subsidiary Everest Capital Limited. For his trouble, Reid managed to secure a lucrative $30,000 per month contract to “continue to oversee the wind-down process of the company”. Crikey has been informed that one of the major purposes of Reid’s $360,000 per year retainer is actually to assist Everest with several legal claims.

As Everest chairman Greg Martin reminded shareholders at the company’s general meeting on Monday — ASIC is still investigating “suspected contraventions of the Corporations Act by various directors and officers of Everest Capital Limited in affording discretionary redemptions”.

It therefore appears that Reid is understood to be receiving $30,000 a month to advise to effectively assist with his own legal defence against an ASIC investigation. There presumably aren’t too many executives across Australia who are being paid by shareholders (who themselves lost 99% of their investment) to defend against an action by a regulator indirectly related to that loss.

Reid will also presumably be assisting Everest in defending the claim by Bernard and Maurice Stang, the wealthy technology investors who are alleging that Reid and [father in law, Stephen Eckowitz] “misled them by promising an attractive rate of return on their investment. They sank a total of $5 million into two Everest funds in July 2002 and August 2003”.

But the largesse lavished upon Reid doesn’t end there. The scion, whose original stake in Everest was funded by his Eckowitz, also received a handsome termination payment. (Sadly things have been going even worse for Eckowitz, whose fortune, once worth $300 million, collapsed in 2009, when his personal investment company was placed into liquidation by creditors).

Reid, who managed to transform a $3 initial investment in Everest into 4 cents and generated “retained losses” of $309 million, also received a remuneration of $1.4 million last year. That appears to be an extraordinarily high sum given Everest’s performance. The $1.4 million consisted of base pay of $560,000 along with termination benefits of $452,308.

But the kicker — Everest spent $3.3 million on “professional fee expenses” — that is lawyers and accountants (as well as a $1 million legal settlement to aggrieved investors). That amounts to almost 75% of revenues being spent on legal and accounting fees. A truly extraordinary achievement.

*Adam Schwab is the author of Pigs at the Trough: Lessons from Australia’s Decade of Corporate Greed.