Auch hier waren mal wieder die anderen Spieler wie GS, JP, Barcley mit im Boot - auch hier wird noch einiges aufzudecken sein - z.B. warum wurden Lehman und Wamu nicht finanziell gestützt - bei AIG Citi BOA usw hat man es getan - wer hatte Interesse, das die den Bach runter gingen, lassen sich daraus Entschädigungen erklagen? Was hat die FDIC versäumt? Wird lange dauern, aber nicht minder spannend wie WaMu. Die Rolle Paulsons als verantwortlicher Finanzminister?? Bei WaMu haben wir heute über 10.000.000 Aufrufe erreicht - ich denke dieser Fall wird nochmal genau so spannend.
Overview
Lehman Brothers was founded in 1850 by two cotton brokers in Montgomery, Ala. The firm moved to New York City after the Civil War and grew into one of Wall Street's investment giants. On Sept. 14, 2008, the investment bank announced that it would file for liquidation after huge losses in the mortgage market and a loss of investor confidence crippled it and it was unable to find a buyer.
In March 2010, a 2,200-page document laid out in new and startling detail how Lehman used accounting sleight of hand to conceal the bad investments that led to its undoing. The report, compiled by an examiner for the bank, concluded that, among other things, the firm's demise was the result of bad mortgage holdings and, less directly, demands by rivals like JPMorgan Chase and Citigroup, that the foundering bank post collateral against loans it desperately needed.
Lehman also used a small company — its "alter ego," in the words of a former Lehman trader — to shift investments off its books, according to an article in The New York Times in April. The relationship raised new questions about the extent to which Lehman obscured its financial condition before it plunged into bankruptcy.
The failed investment bank may have cause to sue Goldman Sachs and Barclays for what might be a "fraudulent transaction," according to a portion of the examiner's report unsealed mid-April.
In May, Lehman Brothers Holdings and a group of unsecured creditors filed a lawsuit against JPMorgan Chase for more than $5 billion, saying it siphoned billions of dollars of Lehman assets, thus hastening its bankruptcy.
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A History That Included Close Calls
Lehman's slow collapse began as the mortgage market crisis unfolded in the summer of 2007, when its stock began a steady fall from a peak of $82 a share. The fears were based on the fact that the firm was a major player in the market for subprime and prime mortgages, and that as the smallest of the major Wall Street firms, it faced a larger risk that large losses could be fatal.
The bank's demise set off tremors throughout the financial system. The uncertainty surrounding its transactions with banks and hedge funds exacerbated a crisis of confidence. That contributed to credit markets freezing, forcing governments around the globe to take steps to try to calm panicked markets.
As the crisis deepened in 2007 and early 2008, the storied investment bank defied expectations more than once, just it had many times before, as in 1998, when it seemed to teeter after a worldwide currency crisis, only to rebound strongly.
Lehman managed to avoid the fate of Bear Stearns, the other of Wall Street's small fry, which was bought by JP Morgan Chase at a bargain basement price under the threat of bankruptcy in March 2008. But by summer of 2008 the rollercoaster ride started to have more downs than ups. A series of write-offs was accompanied by new offerings to seek capital to bolster its finances.
Lehman also fought a running battle with short sellers. The company accused them of spreading rumors to drive down the stock's price; Lehman's critics responded by questioning whether the firm had come clean about the true size of its losses. As time passed and losses mounted, an increasing number of investors sided with the critics.
On June 9, 2008, Lehman announced a second-quarter loss of $2.8 billion, far higher than analysts had expected. The company said it would seek to raise $6 billion in fresh capital from investors. But those efforts faltered, and the situation grew more dire after the government on Sept. 8 announced a takeover of Fannie Mae and Freddie Mac. Lehman's stock plunged as the markets wondered whether the move to save those mortgage giants made it less likely that Lehman might be bailed out.
On Sept. 10, the investment bank said that it would spin off a majority of its remaining commercial real estate holdings into a new public company. And it confirmed plans to sell a majority of its investment management division in a move expected to generate $3 billion. It also announced an expected loss of $3.9 billion, or $5.92 a share, in the third quarter after $5.6 billion in write-downs.
Bankrupt With No Bailout in Sight
By the weekend of Sept. 13-14, it was clear that it was do or die for Lehman. The Treasury had made clear that no bailout would be forthcoming. Federal officials encouraged other institutions to buy Lehman, but by the end of the weekend the two main suitors, Barclays and Bank of America, had both said no.
Lehman filed for bankruptcy Sept. 15. One day later, Barclays said it would buy Lehman's United States capital markets division for $1.75 billion, a bargain price. Nomura Holdings of Japan agreed to buy many of Lehman's assets in Europe, the Middle East and Asia. Lehman also said it would sell much of its money management business, including its prized Neuberger Berman asset management unit, to Bain Capital and Hellman & Friedman for $2.15 billion.
Lehman's demise set off tremors throughout the financial system. The uncertainty surrounding its transactions with banks and hedge funds exacerbated a crisis of confidence. That contributed to credit markets freezing, forcing governments around the globe to take steps to try to calm panicked markets.
On Oct. 5, Richard S. Fuld Jr., Lehman's chief executive, testified before a Congressional panel that while he took full responsibility for the debacle, he believed all his decisions "were both prudent and and appropriate" given the information at the time.
Negligence and Accounting Tricks
In the March 2010, Anton R. Valukas, an examiner for the bank, laid out for the first time what his report characterized as "materially misleading" accounting gimmicks that Lehman used to mask the perilous state of its finances. Lehman used what amounted to financial engineering to temporarily shuffle $50 billion of troubled assets off its books in the months before its collapse in September 2008 to conceal its dependence on leverage, or borrowed money.
Senior Lehman executives, as well as the bank's accountants at Ernst & Young, were aware of the moves, according to Mr. Valukas, the chairman of the law firm Jenner & Block and a former federal prosecutor, who filed the report in connection with Lehman's bankruptcy case.
Mr. Fuld certified the misleading accounts, the report said, which called him "at least grossly negligent." The report also stated that Henry M. Paulson Jr., who was then the Treasury secretary, warned Mr. Fuld that Lehman might fail unless it stabilized its finances or found a buyer.
The report drew no conclusions as to whether Lehman executives violated securities laws. But it did suggest that enough evidence exists for potential civil claims. Lehman executives are already defendants in civil suits, but have not been charged with any criminal wrongdoing.
The New York Times reported in April 2010 that a firm called Hudson Castle played a crucial, behind-the-scenes role at Lehman, shifting investments off its books. While Hudson Castle appeared to be an independent business, it was deeply entwined with the bank. For years, its board was controlled by Lehman, which owned a quarter of the firm. It was also stocked with former Lehman employees, but none of this was disclosed.
Entities like Hudson Castle are part of a vast financial system that operates in the shadows of Wall Street, largely beyond the reach of banking regulators. These entities enable banks to exchange investments for cash to finance their operations and, at times, make their finances look stronger than they are.
A section of the examiner's report disclosed on April 14 said that a transaction transferred $2 billion in assets from C.M.E. Group, which operates the Chicago and New York mercantile exchanges. The assets were collateral and clearing deposits held by C.M.E. and linked to Lehman's futures and options contracts — proprietary trades that Goldman, Barclays, and another firm, DRW Trading, would take on along with the collateral transfer in question.
The transfer resulted in what the report said was "a loss to Lehman exceeding $1.2 billion." Mr. Valukas concluded that "an argument can be made that the transfers at issue were fraudulent transfers avoidable" under bankruptcy law.
In its May lawsuit, Lehman Brothers Holdings accused JPMorgan of extracting billions of dollars in collateral for loans prior to Lehman's bankruptcy by threatening to deprive the bank of services vital to its broker-dealer business. |
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