The NYPost reports that ex-Lehman Brothers (LEHMQ) boss Dick Fuld is feeling “vindicated” in the wake of last week’s 2,200-page report by court-appointed bank examiner, Anton Valukas, who found gaping discrepancies in the accounts of the company Fuld ran.
According to the Post sources, ex-Lehman Brothers CEO believes that despite the fact that Lehman concealed debts of up to $50 billion in the run-up to its collapse, using an accounting trick known as “Repo 105,” the report by examiner Valukas provides proof that Fuld did nothing illegal.
In fact, people in Fuld’s camp, including former CFO Erin Callan and other members of Lehman’s financial team, think that “Repo 105s”, which Lehman had used since 2001 but in the months leading up to its collapse it had significantly stepped up the amount of debt concealed, is the strongest example of Lehman’s supposed shenanigans, Fuld & Co. are in good shape.”
The Post: Indeed, the Repo 105 moves were conducted in the wake of the collapse of Bear Stearns and took place while the Federal Reserve and other Wall Street regulators were inside Lehman monitoring the firm’s activities amid worry of another Wall Street meltdown.
Fuld’s sense of vindication comes as word has it that Lehman’s directors and officers may have burned through most of their tens of millions of dollars in insurance coverage that has helped top executives pay legal fees in the 18 months since Lehman fell.
It is really mind-boggling how one can feel “vindicated” after using deceptive practices and actionable balance sheet manipulation.