Ex-Lehman CEO says federal government refused to help firm

New Delhi News.Net
Thursday 2nd September, 2010

The former chief of Lehman Brothers, Richard S. Fuld Jr, has told a panel investigating the financial crisis that the large Wall Street firm could have been helped to stay afloat by the US government.

Testifying on Wednesday, Fuld said regulators had refused to help even though they later bailed out other big banks.

He said: "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 that while he had personally proposed measures that could have saved the firm, each of those requests was denied.

He said that other financial firms had later received the government assistance that Lehman was denied by the same regulators, who insisted Lehman Brothers file for bankruptcy.

He said it was the only firm that had been ordered to do so.

Lehman’s bankruptcy was the biggest in U.S. history and triggered the panic in financial markets.

Have your say on this story