Quelle surprise !!!: Lehman Execs May Escape Charges

[marmar]

via Truthdig:




Lehman Execs May Escape Charges
Posted on Mar 12, 2011


Who, me? Former Lehman CEO Richard Fuld Jr.

Officials at the SEC have begun to doubt that the agency can prove that executives of the now-defunct Lehman Brothers investment bank broke the law after the company allegedly moved billions of dollars off its balance sheet.

If Lehman Brothers executives do escape prosecution, it will only add to a long list of Wall Street wheeler-dealers who have found a way to avoid punishment. —JCL

Reuters:

A government probe into the fall of Lehman Brothers Holdings Inc has hit so many snags that enforcement officials fear they may never be able to bring civil or criminal charges against company executives, the Wall Street Journal reported on Saturday.

According to the paper, Securities and Exchange Commission officials have begun to doubt they can prove that Lehman broke U.S. laws by moving nearly $50 billion in assets off its balance sheet to make it appear that the securities firm had lowered its debt burden.

Quoting people familiar with the situation, the Journal said SEC officials are also worried they might not win any lawsuit against former Lehman Chief Executive Richard Fuld Jr accusing him of improperly accounting for the value of a large real estate portfolio acquired with the takeover of Archstone-Smith Trust, or to hide losses to investors related to that deal.

Read more

http://www.truthdig.com/eartotheground/item/lehman_execs_may_escape_charges_20110312/

[aquart]

1. They are never in the path of a tsunami, are they?

They just create economic ones for the rest of us.

[Starry Messenger]

2. Well jail time would interfere with any job they might get with the governement.

Who knows? Throwing more financial wizards at this crisis might still work. :sarcasm:

[notesdev]

3. What about the obvious?

It's a felony for a company executive to make purposeful material public misstatements about the financial health of a publicly traded company. This was the guy who said he was going to "burn the shorts" (translated from banker speak: to prove that those who thought the company was overvalued were wrong) mere days before Lehman went under (value: zero).

[Autumn]

4. Not a surprise there

Damn.

[Shandris]

5. I wonder if the 'snags' that were hit were the $100,000,000 kind marked 'Bribe'. (n/t)

[Bozita]

6. SEC and DOJ are fucking cowards. Here's the full WSJ piece...

The baseball equivalent would be taking a called third strike with the bat still sitting on the shoulder.


http://online.wsj.com/article/SB10001424052748703597804576194871565429108.html#articleTabs%3Darticle

-snip-

A year ago, it looked as if the SEC and federal prosecutors had a road map to use against Lehman's former top executives. Last March, the Repo 105 transactions were condemned by court-appointed examiner Anton R. Valukas, who said in a report that they enabled Lehman to "paint a misleading picture of its financial condition."

In the transactions, Lehman swapped fixed-income assets for cash shortly before the securities firm reported quarterly results, promising to buy back the securities later. The cash was used to pay down the company's debts. Emails sent by executives at the company referred to Repo 105 as a "drug" and "basically window dressing."

Mr. Valukas concluded there were "colorable," or credible, legal claims against Ernst & Young, Mr. Fuld and former finance chiefs Ian Lowitt, Erin Callan and Christopher O'Meara.

All four former Lehman executives have been scrutinized by the SEC, according to people familiar with the matter. Their lawyers didn't respond to calls seeking comment. They previously have denied any wrongdoing related to Repo 105.

-snip-

more...

[WillyT]

7. K & R !!!

:kick:

[underpants]

8. Look someone signed those quarterly reports. My wife and I can't believe that "S-OX" isn't in play

Sarbanes Oxley

Executives now hold staff over for looooong nights right before they issue quarterlies. Suddenly the Execs are supposedly liable for the reports.

[somone]

9. The Audacity!

[gratuitous]

10. Who us? No, we didn't defraud anyone!

Say, can you help me carry these large bags of money out to my limo? There's a shiny dime in it for you. See, when you're the CEO of a big financial concern, money just falls out of the sky into your pocket. Nobody knows how or why it happens; nobody can explain it. Anyway, I was, if anything, undercompensated by Lehman for the outstanding job I did.

Well, here we are at my limo. Thanks for your help. Oops, I guess I don't have a shiny dime for you after all. Catch you next time. Bidderman? To the park! *Vrroooooomm!*