Merrill Lynch Warned Regulators About Lehman

[kpete]

Source: Financial Times

Merrill Lynch Warned Regulators About Lehman
Published: Friday, 19 Mar 2010 | 5:53 AM ET
By: Henny Sender, Financial Times

Securities and Exchange Commission and Federal Reserve officials were warned by a leading Wall Street rival that Lehman Brothers was incorrectly calculating a key measure of its financial health months before its collapse in 2008, people familiar with the matter say.

Former Merrill Lynch officials said they contacted regulators about the way Lehman measured its liquidity position for competitive reasons.

The Merrill officials said they were coming under pressure from their trading partners and investors, who feared that Merrill was less ­liquid than Lehman.

The warnings take on a special significance after last week’s report by Anton Valukas, the Lehman bankruptcy court examiner, who found that Lehman had used questionable financing tools to flatter its balance sheet before its September 2008 collapse.

Read more: http://www.cnbc.com/id/35945111

[No Elephants]

1. Some website should have a running list of all the warnings and red flags

that Bushco ignored re: Madoff, Lehman, etc.

[indepat]

2. Surely Cox's SEC and the renominated and reconfirmed Bernanke's Fed would not have

turned a blind eye to information of potential finagling that could lead to such calamitous upheaval on Wall Street and Main Street. Never. :-)