Ex-Lehman CEO Cries Out Loud Because He Didn't Get a Bailout; On the Flipside, He and His Henchmen Made off Big with the Booty

Astonishing! Two Stories Tell Two Sides to the Lehman Debacle!


One of my favorite posters on Motley Fool boards, Goofyhoofy, just laid headlined post "Astonishing! Two Stories!" post on the METAR message board. This post was #258085 posted at 6:08 PM yesterday. To see the original post and the entire thread of answers to it, click here.

For a tease of what you can read from the links Goofyhoofy supplied to display Lehman's "It ain't easy being sleazy culture," I will simply print, word for word, what Goofyhoofy printed in his short post . . . including his two links to the bigger picture at what is wrong with white collar greedheads who used to work at Lehman:

Lehman's Fuld: Where Was Our Bailout?

Richard Fuld, the disgraced head of Lehman Brothers , said he would wonder "until they put me in the ground" why the U.S. government did not rescue the 158-year-old Wall Street firm and claimed regulators knew the full scale of its condition far before its collapse."Until the day they put me in the ground I will wonder," Fuld said in his first public comments since Lehman filed for bankruptcy protection. "I do not know why we were the only one" that was not rescued.


Lehman Managers Portrayed as Irresponsible

Even as the investment bank Lehman Brothers pleaded for a federal bailout to save it from bankruptcy protection, it approved millions of dollars in bonuses for departing executives, a Congressional committee was told Monday.One Lehman document among thousands reviewed by the House committee showed that four days before the bank filed for bankruptcy protection, Lehman’s compensation committee was asked to grant $20 million in “special payments” for three executives who were leaving, Mr. Waxman said. An e-mail exchange recommending a delay in bonus payments was apparently brushed aside.

(Note: the next words are those left by Goofyhoofy in his Original Motley
Fool post.)

Lehman spent $5 billion in executive bonuses, $4 billion in stock buybacks, and another $750 million in dividend payments in the last year, even as the company was being warned by its own internal auditors that it was facing a liquidity problem.

Now here are some important points which Goofyhoofy did not lay out in his short post and which I've scooped from both of his excellent links about the Lehman fiasco. My comments follow the bits I've taken from both New York Times articles.

From the first story Lehman's Fuld: Where Was Our U.S. Bailout?

• In several hours of testimony before Congress, Fuld spoke methodically and at times seemed to preach financial intricacies to lawmakers, losing patience several times with members who pressed him for precise answers. Well I'm sure His Arrogance, Mr. Fuld, made some friends in Congress with his short temper.

• Rep. Henry Waxman, a California Democrat who chairs the panel, is holding hearings to find out what went wrong and what changes are needed in financial services regulation. Waxman is a real congressional pitbull maverick who has been watching out for Americans best interest for years. The guy is not afraid to investigate any wrongdoing in either party.

• The committee obtained thousands of pages of e-mails and other internal Lehman documents that "portray a company in which there was no accountability for failure," Waxman said. Pride goeth before the fall. Chalk another one up for "Companies which are too big to fail."

• Lawmakers on Monday voiced opposition to the bailout bill, blasted Lehman's actions and took exception with Fuld's compensation, which the committee calculated as nearly $500 million in cash, stock and options from 2000 through 2008. Jeez O' Peet. His Arrogance Fuld received half a billion buckaroos for running Lehman into the ground? Where can I get me one of those jobs?

• Rep. Elijah Cummings, a Maryland Democrat, cited an e-mail exchange in which George Walker, President Bush's cousin and a member of the Lehman executive committee, mocked a proposal for top company executives to forego their 2008 bonuses.Walker responded to the proposal from a fund manager at Lehman unit Neuberger Berman by saying, "Sorry, team. I'm not sure what's in the water" at the unit's headquarters. Fuld also dismissed the idea. "Don't worry -- they are only people who think about their own pockets," he said in an e-mail to Walker. Why does this not surprise anyone who has followed members of the Bush family over the past 20 years? Why does this surprise anyone who followed the email trail in the Enron and Worldcom trials where we see over and over again men of no conscience enriching themselves at shareholders's expense.? These guys are sociopathic moneygrippers. If we don't regulate them, they always steal us blind.

• The Federal Reserve and Treasury Secretary Henry Paulson undertook a series of emergency measures to rescue mortgage finance companies Fannie Mae and Freddie Mac. U.S. authorities also orchestrated a deal to sell Bear Stearns to JPMorgan Chase & Co. However, as Lehman's stock continued to plummet and the investment bank was unable to secure a buyer, Paulson was adamant that no government money be used to rescue Lehman. Think about that Paulson guy, Your Arrogance Fuld. Paulson onced headed Goldman Sachs, one of your chief competitors. Did Your Arrogance ever piss off Mr. Paulson on a deal? Do you think this is some kind of payback for your legendary hubris?

From the second link:Lehman Managers Portrayed as Irresponsible

• Richard S. Fuld Jr. blamed the news media. He blamed the short-sellers. He blamed the government, as well as what he characterized as an “extraordinary run on the bank.”But the chief executive of Lehman Brothers Holdings, the bankrupt remnant of a once-great investment house, never really blamed himself. Yes indeed. You rise to the top of one of the biggest investment banks of the planet. You suck out $500 million in bonuses and salary in eight years, you seek the Hosannahs and praise of your cherry picked board, but when there's TROUBLE, you want no accountability? As the Church Lady used to say, "How convenient!"

• Members of the committee, several of whom mispronounced Mr. Fuld’s name as “Fold” or “Food,” also hammered the Lehman chief executive for making what they described as rosy public statements about the bank’s health that did not reflect a scramble for cash behind the scenes. I believe it's pronounced "Fool" rhymes with "cool".

• “I wake up every single night wondering what I could have done differently,” he said. “This is a pain that will stay with me the rest of my life.” Yo, dude, maybe someone would believe this act of being contrite if perhaps you gave back say 90% of what you took to your burned shareholders. Yeah, I'll bet that happen when there are ice bergs in Hell.

• Mr. Fuld, by turns combative and contemplative, and often pained by interruptions of his answers, repeatedly denied that any misrepresentations took place. Even when confronted with internal documents that seemed to tell a different story, Mr. Fuld said he believed until five days before the Sept. 15 bankruptcy filing that Lehman remained in decent health. His Arrogance Fuld must be pained he must sit and be told to shut the "F" up for the first time in his life. Sic Semper Tyrannus.

• At one point on Monday, Mr. Fuld was confronted with an internal memo dated June 8 that included warnings about Lehman’s condition and asked the question, “Why did we allow ourselves to be so exposed?” Mr. Fuld, after a long scan of the memo, said, “This document does not look familiar to me.” Note to His Arrogance Fuld: this is what "stepping on your dick" looks like to outside observers.

• Mr. Fuld was once worth close to $1 billion and now has a net worth estimated at about $100 million. He and his wife have been forced to sell some of their renowned art collection. "Oh my God, dear, don't let them take the Piss Christ, it's still accelerating in value!"

• Later in the hearing, Mr. Fuld was asked why Lehman approved nearly $20 million in payments for two departing executives about a week before the bankruptcy filing. Mr. Fuld said one payment, $2 million for Andrew J. Morton, the head of fixed income, was deemed “appropriate for his years of service.” Another $16 million, paid to Benoit Savoret, who was leaving as chief operating officer for Europe and the Middle East, was a result of a contractual obligation. "Hey, we're golf buddies. After this, I won't ever have to buy another round at the 19th hole."

• After the hearing — which started before a crowd of journalists and a smattering of protesters, then ended almost five hours later before a half-full room — a weary-looking Mr. Fuld approached Mr. Waxman and said he hoped his testimony was helpful. He then left under protection from Capitol Police officers, going to a waiting sport utility vehicle while members of the protest group Code Pink pelted him with insults and called for Mr. Fuld to be jailed. Later in the evening, over Chartre Nondrednon 1953, His Arrogance Fuld explained to his wife it was the Code Pink people who caused Lehman's downfall.