Former Lehman CEO Blames Feds for Collapse
The AP reports on former Lehman Brothers CEO Dick Fuld's testimony before the Financial Crisis Inquiry Commission:
The former chief of Lehman Brothers told a panel investigating the financial crisis that the Wall Street firm collapsed under uncontrollable market forces and regulators' refusal to rescue it.
Richard S. Fuld Jr. told the Financial Crisis Inquiry Commission at a hearing that Lehman did everything it could to limit its risks and save itself in the fall of 2008.
"Lehman's demise was caused by uncontrollable market forces, and the incorrect perception and accompanying rumors that Lehman did not have sufficient capital to support its investments," Fuld testified. He said Lehman proposed measures to federal regulators that could have saved the firm, but "each of those requests was denied."
Unfairly, Fuld said, other financial firms later received the government assistance that Lehman was denied. Lehman was "mandated" by regulators to file for bankruptcy on Sept. 15, 2008 — the only firm ordered to do so, he said.
Lehman's collapse into the biggest bankruptcy in U.S. history and it triggered a panic in financial markets.
"Lehman was forced into bankruptcy not because it neglected to act responsibly or seek solutions to the crisis, but because of a decision, based on flawed information, not to provide Lehman with the support given to each of its competitors," said Fuld.
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