Lehman Brothers

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US Default Would 'Blow Lehman Out of the Water'

US has 23 times the debt

(Newser) - If you think we saw a global financial disaster with the collapse of Lehman five years ago, just wait and see what happens if the US government defaults on its debt, warn financial experts. Lehman was $517 billion in debt—the US owes $12 trillion. The unprecedented event would cripple... More »

Why Lehman Brothers Wasn't Prosecuted

The SEC's special division wasn't in favor

(Newser) - When SEC chief Mary Schapiro heard that her eight-member Lehman Brothers team had decided not to file charges for the bank's role in the financial crisis, she held a tense, private meeting with New York branch chief George Canellos. "I don't get it. Why is there no... More »

Wall Street's Fear: Senators Who Know Things

Bankers want no part of 'expert' Elizabeth Warren, Dave Sirota writes

(Newser) - Get Wall Street executives drunk enough, and David Sirota of Salon is pretty sure they'll confess that they like their legislators to be incurious and ill-informed. How does he know? Because one former Lehman Brothers trader recently admitted as much in a recent Businessweek piece on the Massachusetts Senate... More »

JPMorgan Pays $20M Slap on Wrist Over Lehman

Regulators fine it $20M for improper lending

(Newser) - Federal regulators have filed their first action related to the momentous, crisis-sparking collapse of Lehman Brothers, but it won't amount to much. The Commodity Futures Trading Commission today filed a civil case against JPMorgan Chase, accusing it of overextending credit to Lehman, the New York Times reports. But JPMorgan... More »

Lehman Lives on— and It's Getting Bigger

Financial giants refuse to die, Steven Davidoff explains

(Newser) - You might remember Lehman Brothers from its starring role in kicking off 2008's financial crisis by declaring bankruptcy, and hence, you might think it is dead and buried. But you'd be wrong, writes Steven Davidoff in the New York Times : Lehman is actually still shambling around, zombie-like, and... More »

Time to Make Wall Street Pay

Michael Thomas thinks Wall Street has destroyed America

(Newser) - At 75, novelist Michael Thomas has seen much. “If anyone asks me what has been the great American story of my lifetime, I have a ready answer,” he writes in Newsweek : “It is the corruption, money-based, that has settled like some all-enveloping excremental mist on the landscape... More »

Feds Sue Big Banks Over Mortgages

US accuses them of dodging due diligence as crisis fallout spreads

(Newser) - The Federal Housing Finance Agency—the agency behind Fannie Mae and Freddy Mac—has filed suit against more than a dozen big banks for their role in the mortgage meltdown mess. The feds, seeking billions in compensation, accuse the banks of misrepresenting the quality of mortgage securities, reports the New ... More »

SEC Shredded Files to Cover Up Crimes: Whistleblower

Matt Taibbi reports on an insane, probably illegal practice

(Newser) - Police aren’t generally in the habit of destroying evidence from failed investigations—but the SEC is, according to one whistleblower. SEC attorney Darcy Flynn spilled the beans to Congress in July, saying that the SEC routinely destroys all documents related to its preliminary investigations if they don’t proceed.... More »

Debt Crisis Could Make Lehman's Fail Look Lame

Downgrade could be worse: Neel Kashkari

(Newser) - If the debt follies in Washington result in US credit being downgraded, it could end up being a worse financial hit than the epic failure of Lehman Brothers, writes Neel Kashkari. The former assistant secretary to the Treasury, who was appointed by George W Bush to oversee the $700 billion... More »

Ernst & Young Hit With Civil Fraud Suit

Andrew Cuomo cites 'massive accounting fraud' in Lehman Bros. dealings

(Newser) - Andrew Cuomo filed a civil fraud lawsuit against Ernst & Young today, following reports that the company allegedly helped Lehman Brothers mislead investors . According to the complaint, the accounting firm approved Lehman’s use of “Repo 105” transactions, a type of debt that was labeled as sales to reduce... More »

Fraud Charges Loom for Ernst & Young

Accounting firm helped Lehman Brothers cook the books, prosecutors allege

(Newser) - Ernst & Young is poised to become the first major accounting firm charged for having a hand in the financial crisis. New York prosecutors are planning to file civil fraud charges against the firm for the role it allegedly played in the collapse of Lehman Brothers, one of its biggest... More »

Lehman Bros. Paintings Fetch $12.3M for Creditors

Sotheby's auctions art from collapsed banking giant

(Newser) - They're going to need a lot more paintings: Lehman Bros. raised $12.3 million tonight at Sotheby's by selling off artwork it picked up during its golden run on Wall Street, reports BBC . It's good news for Lehman's many creditors, but not great news considering the collapsed investment bank owes... More »

Bernanke: We Must Fix the 'Too Big to Fail' Problem

Fed chair defends financial crisis actions

(Newser) - The government must be ready to close even the biggest banks if they threaten to bring down the financial system, Ben Bernanke said today, in testimony before the Financial Crisis Inquiry Commission. "If the crisis has a single lesson, it is that the too-big-to-fail problem must be solved,"... More »

Lehman CEO Blames Fed for Financial Crisis

(Newser) - In a remarkable case of the pot calling the kettle black, Lehman Brothers' former CEO Richard Fuld pointed a finger at the US Federal reserve today, saying it worsened the financial crisis in September 2008. Testifying at a hearing, Fuld blamed the Fed for letting the investment bank fail. He... More »

Meet the Best Paid Execs of the Decade

Only some of them actually made money for shareholders

(Newser) - Maybe those giant executive pay packages weren’t such great ideas after all. Of the eleven highest paid executives of the last decade, five presided over companies that lost their shareholders money, the Wall Street Journal reveals today, breaking down the numbers to reveal who the decade was most generous... More »

Lehman Estate Sues JPMorgan for Billions

Suit: Firm 'held gun' to Lehman in massive ripoff

(Newser) - Lehman Brothers' bankruptcy estate has launched a huge lawsuit against JPMorgan Chase, accusing the bank of abusing its position to siphon off billions of dollars in Lehman's dying days. The suit alleges that JPMorgan used its inside knowledge of Lehman's troubles to hold a "financial gun" to its head,... More »

Lehman Post Mortem Bares Shady Tricks

Execs may land in court for disguising bad investments

(Newser) - Lehman Brothers tried to buy itself time by manipulating accounting gimmicks to disguise its bad investments, according to a court-ordered report on the firm's demise. The exhaustive, 2,200 page report found that execs, including former CEO Richard Fuld, could be held legally liable for the "materially misleading" attempt... More »

Exec: Ax Teacher for 'Sleazeball' Banker Slam

$25M-a-year banker outraged over comments to son's class

(Newser) - One of Wall Street's highest paid executives is pressing to have his son's teacher axed for insulting the banking world. Hugh McGee, who makes $25 million a year as Barclays' global head of investment banking, says the teacher told his son's 11th-grade history class last year that "all investment... More »

Count the US Dollar Down, But Not Out

Fears of a looming currency crash are overblown

(Newser) - With the US economy in a prolonged slump and the Fed likely to keep interest rates low for the foreseeable future, many worry that a dollar crash will be the next shoe to drop. Currency pessimists can point to a 6-month decline in the dollar; this week the currency hit... More »

Fed May Have Outmuscled Other Lehman Creditors

Government creditors got their cash back; private investors still struggling

(Newser) - A special court examiner investigating the Lehman Brothers bankruptcy is trying to determine whether the Fed used its clout to get its money back from the collapsed bank ahead of other creditors. The central bank and its New York branch lent Lehman $46 billion before the bankruptcy but was promptly... More »

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