NY Fed Under Geithner Implicated in Lehman Accounting Fraud Allegation

[dkf]

"Well, it is folks, as a newly-released examiner’s report by Anton Valukas in connection with the Lehman bankruptcy makes clear. The unraveling isn’t merely implicating Fuld and his recent succession of CFOs, or its accounting firm, Ernst & Young, as might be expected. It also emerges that the NY Fed, and thus Timothy Geithner, were at a minimum massively derelict in the performance of their duties, and may well be culpable in aiding and abetting Lehman in accounting fraud and Sarbox violations.

We need to demand an immediate release of the e-mails, phone records, and meeting notes from the NY Fed and key Lehman principals regarding the NY Fed’s review of Lehman’s solvency. If, as things appear now, Lehman was allowed by the Fed’s inaction to remain in business, when the Fed should have insisted on a wind-down (and the failed Barclay’s said this was not infeasible: even an orderly bankruptcy would have been preferrable, as Harvey Miller, who handled the Lehman BK filing has made clear; a good bank/bad bank structure, with a Fed backstop of the bad bank, would have been an option if the Fed’s justification for inaction was systemic risk), the NY Fed at a minimum helped perpetuate a fraud on investors and counterparties.

This pattern further suggests the Fed, which by its charter is tasked to promote the safety and soundness of the banking system, instead, via its collusion with Lehman management, operated to protect particular actors to the detriment of the public at large.

And most important, it says that the NY Fed, and likely Geithner himself, undermined, perhaps even violated, laws designed to protect investors and markets. If so, he is not fit to be Treasury secretary or hold any office related to financial supervision and should resign immediately."

http://www.nakedcapitalism.com/2010/03/ny-fed-under-geithner-implicated-in-lehman-accounting-fraud.html

[yurbud]

1. when is Obama going to shed these Wall Street tapeworms?

[havocmom]

2. The fact that he ever appointed them at all speaks volumes

and scares the crap outta me.

[yurbud]

5. did you see the scene in Michael Moore's CAPITALISM: A LOVE STORY with Reagan & Donald Reagan?

Reagan was speaking at the New York Stock exchange, and Regan leans over and tells him to hurry it up, not as a suggestion but as an order, and Reagan gets all apologetic briefly.

Donald Regan was from Goldman Sachs.

I wish we had a president who could get in touch with his inner Michael Corleone and take these bastards out. Do like Put in did and arrest an oligarch and throw him into the deepest darkest hole and throw away the key.

[dkf]

3. I shudder to think what will come of this.

It makes me very nervous indeed.

[aquart]

4. My worst fear is that nothing will come of it.

The Obama administration's refusal to prosecute the real criminals, the perpetrators of HUGE crimes, is diminishing every hope I had.

[truedelphi]

8. Somehow he thinks that stalling around and pretending that he is so forward looking -

All that may well come back to haunt him.

When the RW returns to power, they won't have any hestiation on hanging any of the various messes on him.

And his unwillingneess to democstrate the aprt the other historic figures had to play in these messes, those blanks in the historic record will have his name pasted in. And though he won't deserve endiing up to blame for everything, he certainly wasn't wise enought to avoid what is happening.

[notesdev]

6. If Geithner is still there in November

and the GOP takes the House as it most certainly will, you will hear the word "impeachment" a lot. Geithner is a key enabling figure in crimes of historic proportions, and a big reason why trust is very hard to come by.

[upi402]

7. and Summers et al

:banghead: