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The arrogance is beyond belief. Someone needs a thorough asswhooping complements of the American Public.
Quote:
Congress hears Lehman sought millions for execs
Oct 6, 2:36 PM (ET)
By JULIE HIRSCHFELD DAVIS
WASHINGTON (AP) - Days from becoming the largest bankruptcy in U.S. history, Lehman Brothers steered millions to departing executives even while pleading for a federal rescue, Congress was told Monday.
As well, executives who feared for their bonuses in the company's last months were told not to worry, according to documents cited at a congressional hearing. One executive said he was embarrassed when employees suggested that Lehman executives forgo bonuses, and cracked: "I'm not sure what's in the water."
The first hearing into what caused the nation's financial markets to collapse last month, precipitating a $700 billion bailout, opened with finger-pointing and glimpses into internal company documents from Lehman's chaotic last hours.
Rep. Henry Waxman, D-Calif., chairman of the House Oversight and Government Reform Committee, said the giant investment bank was "a company in which there was no accountability for failure." Lehman's collapse set off a panic that within days had President Bush and Treasury Secretary Henry Paulson asking Congress to pass the rescue plan for the financial sector.
Richard S. Fuld Jr., chief executive officer of Lehman Brothers, declared to the committee "I take full responsibility for the decisions that I made and for the actions that I took." He defended his actions as "prudent and appropriate" based on information he had at the time.
"I feel horrible about what happened," he said.
Waxman questioned Fuld on whether it was true he took home some $480 million in compensation since 2000, and asked: "Is that fair?"
Fuld took off his glasses, held them, and looked uncomfortable. He said his compensation was not quite that much.
"We had a compensation committee that spent a tremendous amount of time making sure that the interests of the executives and the employees were aligned with shareholders," he said. Fuld said he took home over $300 million in those years - some $60 million in cash compensation.
Waxman read excerpts from Lehman documents in which a recommendation that top management should forgo bonuses was apparently brushed aside. He also cited a Sept. 11 request to Lehman's compensation board that three executives leaving the company be given $20 million in "special payments."
"In other words, even as Mr. Fuld was pleading with Secretary Paulson for a federal rescue, Lehman continued to squander millions on executive compensation," Waxman said before Fuld appeared as a witness.
The government let Lehman go under Sept. 15, only to bail out insurance giant American International Group the next day, in a cascading series of financial shocks and failures that put Washington on track for the multibillion-dollar rescue starting the end of that week.
Waxman described that plan as a life-support measure. "It may keep our economy from collapsing but it won't make it healthy again," he said.
That sentiment echoed on Wall Street, where the Dow Jones industrials sank below 10,000 on Monday for the first time in four years. Investors fear the crisis will weigh down the global economy and the bailout won't work quickly to loosen credit markets.
The rescue plan, now law, was so rushed that the usual congressional scrutiny is only coming now, after the fact.
"Although it comes too late to help Lehman Brothers, the so-called bailout program will have to make wrenching choices, picking winners and losers from a shattered and fragile economic landscape," said Rep. Tom Davis of Virginia, the committee's senior Republican.
Waxman said that in January, Fuld and his board were warned the company's "liquidity can disappear quite fast."
Despite that warning, he said, "Mr. Fuld depleted Lehman's capital reserves by over $10 billion through year-end bonuses, stock buybacks, and dividend payments."
Waxman quoted Fuld as saying in one document, "Don't worry" to the suggestion that executives go without bonuses.
That suggestion came from Lehman's money management subsidiary, Neuberger Berman. Waxman quoted George H. Walker, President Bush's cousin and a Lehman executive who oversaw some Neuberger Berman employees, as responding with a dismissive tone to the idea of going without bonuses.
"Sorry team," he wrote to the executive committee, according to Waxman. "I'm not sure what's in the water at 605 Third Avenue today.... I'm embarrassed and I apologize."
Rep. Elijah Cummings, D-Md., said: "I wonder how he sleeps at night."
Fuld said in his statement that the company did everything it could to limits its risks and save itself.
"In the end, despite all our efforts, we were overwhelmed, others were overwhelmed, and still other institutions would have been overwhelmed had the government not stepped in to save them," he said.
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In politics, nothing happens by accident. If it happens, you can bet it was planned that way.
Franklin D. Roosevelt
"The moment you think you got it figured...you're wrong." Mr. Rate
They gonna put you in one of them fema coffins if you are not carefull.
*click*
Go ahead and let them try.
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“That’s another thing we are trying to establish, that we will be relentless and we are going to play physical,” defensive end Antonio Smith. “If you do catch the check-downs, you’re going to have to pay for it.”
It upsets me anytime I see a CEO of a company that's going down the drain give himself and others million dollar bonuses. Here's an idea for all these guys, if you have to lay off thousands of workers you're not doing a good enough job to deserve a bonus.
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RIP King of Cards
Tim Minnick 9/12/1972-3/4/2007
You'll be missed.
They gonna put you in one of them fema coffins if you are not carefull.
I don't think so.
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At what point then is the approach of danger to be expected? I answer, if it ever reach us, it must spring up amongst us. It cannot come from abroad. If destruction be our lot, we must ourselves be its author and finisher. As a nation of freemen, we must live through all time, or die by suicide.
OJ Simpson takes back items stolen from him by thieves. A jury decides he is guilty, which technically he is. He now faces a possible life in prison sentence. The revenge and outrage for his acquittal has really gnawed at the public craw. Too bad the same outrage and revenge isn't in place for the financial criminals.
Thousands upon thousands of carpetbaggers stole billions of our hard earned dollars and get golden parachutes and/or a second ( actually nth chance) chance to get the bail out funds with absolutely no sanctions. They stole the 401ks, the IRAs, the pensions. Where is the balance and outrage.
I don't give a crap about O J , but America does. Maybe he is easier to understand than the concept that America will be working to the grave, but WTH, we will probably sit by idly and let them rob our graves. That has been the pattern for a long time.
While we are at it, anyone care to rehash Eliott Spitzer? He went after these same robber barons, and they denutted him with petty morals accusations while the public was distracted by outrage. Seems rather petty and imbalanced to me.
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In politics, nothing happens by accident. If it happens, you can bet it was planned that way.
Franklin D. Roosevelt
"The moment you think you got it figured...you're wrong." Mr. Rate
Last edited by wallyburger; October 7th, 2008 at 05:17 AM.
“From two very senior sources – one incredibly senior source – that he went to the gym after … Lehman was announced as going under. He was on a treadmill with a heart monitor on. Someone was in the corner, pumping iron and he walked over and he knocked him out cold. And frankly after having watched this, I’d have done the same too.”
Even on a small level, it is nice to see a little action.
The CEO should be happy it wasn't a gun or a knife. Which he would have deserved as well, so I would say this guys it pretty lucky.
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“That’s another thing we are trying to establish, that we will be relentless and we are going to play physical,” defensive end Antonio Smith. “If you do catch the check-downs, you’re going to have to pay for it.”
My favorite thing about all this is that the Right Wing likes to brag that everything they get is through merit.
What possible merit is there in all these golden parachute CEO/CFO's actions the past couple years?
The lynch mobs should form from the ranks of the wiped out stockholders and workers from these banks.
The arrogance of these Plutocratic old men is stunning.
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"Seachicken - it's what's for dinner" - me (until the 'Hawks sweep the Cards)
Every man has at least a bit of womanizer in him.
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