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Lehman May 22
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Lehman Brothers Sues Over Soured Old Mortgage Loans
May 21, 2015 | Dow Jones - Daily Bankruptcy Review
By Joseph Checkler
Lehman Brothers Holdings Inc . is suing three financial institutions over bundles of soured old mortgage loans, calling claims that Lehman owes hundreds of millions of dollars "grossly exaggerated and baseless." In a Wednesday filing with U.S. Bankruptcy Court in Manhattan, Lehman asked a judge to disallow "duplicate" claims... -
County Settles Lehman Claim
May 22, 2015 | Half Moon Bay Review
San Mateo County is part of a $6.5 million settlement with Lehman Brothers auditors Ernst & Young. Tuesday’s announcement marks the end of legal efforts to recoup government losses from the 2008 Lehman bankruptcy. Lehman’s failure spelled a $155 million loss to the county’s Investment Pool that held money belonging to the county... -
Warren-Vitter Bill Curtails Fed’s Lender-of-Last-Resort Power
May 21, 2015 | Breitbart
By Chriss W. Street
...But real-world financial panics develop quickly due to some triggering event metastasizing from fear into dread panic and confusion. It took 3 former judges until April 2014 to rule that Lehman’s management, not Ernst & Young, were responsible for Lehman’s accounting gimmick of temporarily moving tens of billions of dollars...
Client Attorney Privileged/Attorney Work Product/At Request of Counsel
U.S. Bankruptcy Court in Manhattan
Ernst & Young
Warren-Vitter Bill
Full Text of Stories Below
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Lehman Brothers Sues Over Soured Old Mortgage Loans
May 21, 2015 | Dow Jones - Daily Bankruptcy Review
By Joseph Checkler
Lehman Brothers Holdings Inc . is suing three financial institutions over bundles of soured old mortgage loans, calling claims that Lehman owes hundreds of millions of dollars "grossly exaggerated and baseless."
In a Wednesday filing with U.S. Bankruptcy Court in Manhattan, Lehman asked a judge to disallow "duplicate" claims filed by units of Syncora Holdings Ltd. and U.S. Bancorp . The third party named in the suit is GreenPoint Mortgage Funding Inc ., which made the loans in the first place and is being sued by U.S. Bank and Syncora in a separate proceeding over the same issues. Lehman has set aside money for the claims and wants the issue settled so it can pay back other creditors...
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http://bankruptcynews.dowjones.com/Article?an=DJFDBR0120150521eb5lnhl91&cid=32135018&ctype=ts&ReturnUrl=http%3a%2f%2fbankruptcynews.dowjones.com%2fArticle%3fan%3dDJFDBR0120150521eb5lnhl91%26cid%3d32135018%26ctype%3dts
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May 22, 2015 | Half Moon Bay Review
San Mateo County is part of a $6.5 million settlement with Lehman Brothers auditors Ernst & Young. Tuesday’s announcement marks the end of legal efforts to recoup government losses from the 2008 Lehman bankruptcy.
Lehman’s failure spelled a $155 million loss to the county’s Investment Pool that held money belonging to the county, school districts, special districts, and other public agencies in more than 1,050 accounts. The county’s Investment Pool ultimately recovered more than $71 million — or 46 percent of losses — through bankruptcy proceedings and litigation against Lehman Brothers’ directors and officers and Lehman’s auditors, Ernst & Young.
According to a San Mateo County release, the local approach served as a template for other jurisdictions seeking redress. Unlike bankruptcy proceedings, the county’s litigation targeted the personal assets of specific executives including former CEO Richard Fuld. The litigation sought to hold them responsible for the firm’s financial failure...
For full story:
http://www.hmbreview.com/news/county-settles-lehman-claim/article_54ddebbe-0000-11e5-ba09-5f7e74d07eaa.html
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Warren-Vitter Bill Curtails Fed’s Lender-of-Last-Resort Power
May 21, 2015 | Breitbart
By Chriss W. Street
There is plenty of room to debate the benefits of the U.S. Federal Reserve’s monetary policy. But Senators Sen. Elizabeth Warren (D-MA)12% (MA-D) and Sen. David Vitter (R-LA)73% (LA-R)’s bipartisan bill, the “Bailout Prevention Act of 2015,” would further restrict the Fed’s emergency lender-of-last-resort ability in a crisis. The bipartisan bill may make perfect bureaucratic sense, but it would make the next financial panic much more intense.
During the 2007 through 2009 Great Financial Crisis (GFC), the Fed used its emergency lending authority to make lender-of-last-resort loans to prevent the collapse of Bear Stearns and AIG. The Fed’s actions, with the full support of the Treasury Department and Congress, prevented the disorderly implosion of two “systematically” large, complex, and highly interconnected firms.
Former Chair Ben Bernanke has argued that if the Fed had not taken such actions, the U.S. would have suffered two additional financial panics, similar to the aftermath of the September 2008 Lehman Brothers bankruptcy. According to FDIC Chairman Martin Gruenberg, the disorderly bankruptcy of Lehman Brothers...
...The Warren-Vitter bill requires the Fed and the supervisors of any company receiving lender-of-last-resort loans to certify the firm’s solvency and make the analysis immediately public. Bureaucratically, this seems to make perfect sense. But real-world financial panics develop quickly due to some triggering event metastasizing from fear into dread panic and confusion. It took 3 former judges until April 2014 to rule that Lehman’s management, not Ernst & Young, were responsible for Lehman’s accounting gimmick of temporarily moving tens of billions of dollars in debt off its balance sheet at the end of each quarter to make Lehman brothers look more solvent.
The Warren-Vitter bill also requires the interest rate on any emergency lender-of-last-resort loans be set at least 5 percentage points above the “Treasury rate.” This also makes bureaucratic sense, but banks operate at interest rate spreads of about +1.5 percent. Making the Fed a “white knuckle lender” means the “rescued” financial institution would be paying an interest rate that guarantees its insolvency. Such a move would cause all other creditors to panic and demand immediate payment...
For full story:
http://www.breitbart.com/big-government/2015/05/21/warren-vitter-bill-curtails-feds-lender-of-last-resort-power/
Client Attorney Privileged/Attorney Work Product/At Request of Counsel
U.S. Bankruptcy Court in Manhattan
Ernst & Young
Warren-Vitter Bill
Full Text of Stories Below
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