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Monday, September 14, 2009
Morgan Keegan Slapped with $1.4 Million Arbitration Award for RMK Fund Losses
Last Friday (9/11/09), ex-NBA Star Horace Grant recently received an arbitration award totalling $1.46 million for losses he experienced investing in several of the Regions Morgan Keegan Bond Funds (RMK Funds).
In his arbitration claim filed with the Financial Industry Regulatory Authority (FINRA) Mr. Grant alleged the true risk of the funds were note disclosed and the funds were speculative. The close-end funds in question were the Regions Morgan Keegan Multi-Sector Income Fund, Regions Morgan Keegan High Income Fund, Regions Morgan Keegan Strategic Income Fund, and Regions Morgan Keegan Advantage Income Fund.
Morgan Keegan has faced hundreds of claims for losses by investors who held the funds which bet heavily in the mortgage and structured finance markets and lost big. The funds' manager, one time investment guru James Kelsoe was removed as manager and the funds were sold to Hyperion Asset management and the names changed. The funds have since been liquidated.
The attorney's at Colling Gilbert Wright & Carter are currently representing clients with losses in one or more of the RMK bond funds. If you have experienced losses in a RMK fund, please contact our office for a free case evaluation.
In his arbitration claim filed with the Financial Industry Regulatory Authority (FINRA) Mr. Grant alleged the true risk of the funds were note disclosed and the funds were speculative. The close-end funds in question were the Regions Morgan Keegan Multi-Sector Income Fund, Regions Morgan Keegan High Income Fund, Regions Morgan Keegan Strategic Income Fund, and Regions Morgan Keegan Advantage Income Fund.
Morgan Keegan has faced hundreds of claims for losses by investors who held the funds which bet heavily in the mortgage and structured finance markets and lost big. The funds' manager, one time investment guru James Kelsoe was removed as manager and the funds were sold to Hyperion Asset management and the names changed. The funds have since been liquidated.
The attorney's at Colling Gilbert Wright & Carter are currently representing clients with losses in one or more of the RMK bond funds. If you have experienced losses in a RMK fund, please contact our office for a free case evaluation.
posted by
William B. Young Jr. Esq.
at
12:21 PM
UBS Employee Refers to CDO's as "Vomit"
In a recent Wall Street Journal article, an email produced in a civil court case against UBS, an employee referred to Collateralized Debt Obligations (CDOs) as "vomit." The evidence indicates UBS employees were aware of the problems in the CDO market and were actively trying to unload the debt on unsuspecting fund managers and retail investors. The full WSJ article appears below:
In the summer and fall of 2007, as the credit crunch deepened, some U.S. employees at UBS AG became increasingly concerned about billions of dollars of debt securities inventoried on the bank's books and wanted to find a way to unload them, according to emails in a court case.
A judge issued a decision this week that said there was evidence UBS had an "awareness that ... high-grade securities on its hands would soon turn into financial toxic waste" as it tried to persuade a hedge fund to but CDOs. Above, the UBS in Zurich in July. "OK still have this vomit?" one UBS employee asked.
The email emerged in a lawsuit against UBS, alleging that the Swiss bank found at least one place to sell the problem securities: Stamford, Conn., hedge fund Pursuit Partners LLC.
Documents filed in the Connecticut court case provide one of the more complete windows into how UBS allegedly scrambled internally to find ways to alleviate the financial pain that worsened throughout 2007 thanks to the deteriorating mortgage market. They also add to a debate that continues across Wall Street and beyond about bankers' culpability in the financial crisis.
This week, Connecticut Superior Court Judge John F. Blawie issued a decision that said there was evidence to show that UBS ultimately had an "awareness that ... high-grade securities on its hands would soon turn into financial toxic waste" as it tried to persuade Pursuit to buy debt securities known as collateralized debt obligations, or CDOs.
The hedge fund says it invested in three CDOs and had losses of $35.5 million. Pursuit has alleged that it sought steady cash flow and required that it be sold only investment-grade securities, or ones that provide relatively low risk of default. UBS did sell Pursuit investment-grade securities but knew that the securities were about to be downgraded, Pursuit alleges.
Pursuit initially filed a complaint against UBS in March 2008. It subsequently asked the court to require UBS to set aside money or assets to cover Pursuit's losses, which the judge granted on Tuesday when he ordered that the bank set aside $35.5 million to cover a potential judgment against it in the case. UBS says that the order was preliminary and that the firm intends to prevail in the case.
Judge Orders UBS to Set Aside $35 Million in Hedge- Fund Case As part of a three-day hearing on that request this past April, more details came to light, including information provided by former UBS bond salesman Robert Morelli. A lawyer for Mr. Morelli, Dane Butswinkas, declined to comment.
Until the spring of 2007, UBS had been seen as a conservative bank that specialized in private banking. But in 2006 and 2007, UBS also ramped up in selling and trading debt securities to better compete with Wall Street and London firms.
In May 2007, the first hint of trouble with this strategy came in the wake of losses at in-house hedge fund Dillon Read Capital Management, a UBS shareholders report noted.
That month, according to the judge's ruling, UBS "had reason to believe that Moody's was changing its methodology and that would result in the downgrading of certain asset-backed securities." A Moody's spokesman said the firm had no comment on the judge's decision.
On July 11, 2007, Moody's said it would review for possible downgrade a small percentage of the universe of CDOs, just after it cut ratings on subprime-mortgage bonds -- the building blocks for many CDOs.
Mr. Morelli sent an email on that day telling colleagues to "put today in your calendar." Mr. Morelli later said in the case the day "was essentially the beginning of the end of the CDO business, meaning the bonds were getting downgraded, they were probably going to get downgraded further, and we were going to lose a lot of money," according to a court transcript cited in Judge Blawie's decision.
On July 26, UBS instructed employees to "reduce cdos ... no need to publicly relay this," the decision says. That day, Pursuit started its purchases from UBS.
On Aug. 28, Mr. Morelli said in an email that he had "sold more crap to Pursuit," according to the decision. On Sept. 24, as the October downgrades neared, an unnamed UBS employee emailed a UBS banker and referred to CDO inventory on UBS's books. "OK still have this vomit?" the employee asked. Pursuit's last purchase came on Oct. 1.
Starting Oct. 11, Moody's downgraded ratings on more subprime-mortgage bonds. Pursuit's securities were completely wiped out by early 2008.
The judge said Pursuit and its lawyers had established probable cause to back up a claim that UBS employees "were in possession of material nonpublic information regarding imminent ratings downgrades on the Notes it sold" to Pursuit.
"The court takes UBS employees at their word when they referenced their Notes, these purported 'investment-grade' securities which they sold, as 'crap' and 'vomit,' for UBS alone possessed the knowledge of what their product, their inventory, was truly worth," he wrote.
The attorney's at Colling Gilbert Wright & Carter are investigating and filing FINRA arbitration claims against UBS and other brokerage firms that sold structured notes (PPNs, PPPNs and RONs) backed by Lehman Brothers and other toxic debt to retail investors. If you lost money in a UBS structured products, please contact our offices for a free case evaluation. Thank you.
In the summer and fall of 2007, as the credit crunch deepened, some U.S. employees at UBS AG became increasingly concerned about billions of dollars of debt securities inventoried on the bank's books and wanted to find a way to unload them, according to emails in a court case.
A judge issued a decision this week that said there was evidence UBS had an "awareness that ... high-grade securities on its hands would soon turn into financial toxic waste" as it tried to persuade a hedge fund to but CDOs. Above, the UBS in Zurich in July. "OK still have this vomit?" one UBS employee asked.
The email emerged in a lawsuit against UBS, alleging that the Swiss bank found at least one place to sell the problem securities: Stamford, Conn., hedge fund Pursuit Partners LLC.
Documents filed in the Connecticut court case provide one of the more complete windows into how UBS allegedly scrambled internally to find ways to alleviate the financial pain that worsened throughout 2007 thanks to the deteriorating mortgage market. They also add to a debate that continues across Wall Street and beyond about bankers' culpability in the financial crisis.
This week, Connecticut Superior Court Judge John F. Blawie issued a decision that said there was evidence to show that UBS ultimately had an "awareness that ... high-grade securities on its hands would soon turn into financial toxic waste" as it tried to persuade Pursuit to buy debt securities known as collateralized debt obligations, or CDOs.
The hedge fund says it invested in three CDOs and had losses of $35.5 million. Pursuit has alleged that it sought steady cash flow and required that it be sold only investment-grade securities, or ones that provide relatively low risk of default. UBS did sell Pursuit investment-grade securities but knew that the securities were about to be downgraded, Pursuit alleges.
Pursuit initially filed a complaint against UBS in March 2008. It subsequently asked the court to require UBS to set aside money or assets to cover Pursuit's losses, which the judge granted on Tuesday when he ordered that the bank set aside $35.5 million to cover a potential judgment against it in the case. UBS says that the order was preliminary and that the firm intends to prevail in the case.
Judge Orders UBS to Set Aside $35 Million in Hedge- Fund Case As part of a three-day hearing on that request this past April, more details came to light, including information provided by former UBS bond salesman Robert Morelli. A lawyer for Mr. Morelli, Dane Butswinkas, declined to comment.
Until the spring of 2007, UBS had been seen as a conservative bank that specialized in private banking. But in 2006 and 2007, UBS also ramped up in selling and trading debt securities to better compete with Wall Street and London firms.
In May 2007, the first hint of trouble with this strategy came in the wake of losses at in-house hedge fund Dillon Read Capital Management, a UBS shareholders report noted.
That month, according to the judge's ruling, UBS "had reason to believe that Moody's was changing its methodology and that would result in the downgrading of certain asset-backed securities." A Moody's spokesman said the firm had no comment on the judge's decision.
On July 11, 2007, Moody's said it would review for possible downgrade a small percentage of the universe of CDOs, just after it cut ratings on subprime-mortgage bonds -- the building blocks for many CDOs.
Mr. Morelli sent an email on that day telling colleagues to "put today in your calendar." Mr. Morelli later said in the case the day "was essentially the beginning of the end of the CDO business, meaning the bonds were getting downgraded, they were probably going to get downgraded further, and we were going to lose a lot of money," according to a court transcript cited in Judge Blawie's decision.
On July 26, UBS instructed employees to "reduce cdos ... no need to publicly relay this," the decision says. That day, Pursuit started its purchases from UBS.
On Aug. 28, Mr. Morelli said in an email that he had "sold more crap to Pursuit," according to the decision. On Sept. 24, as the October downgrades neared, an unnamed UBS employee emailed a UBS banker and referred to CDO inventory on UBS's books. "OK still have this vomit?" the employee asked. Pursuit's last purchase came on Oct. 1.
Starting Oct. 11, Moody's downgraded ratings on more subprime-mortgage bonds. Pursuit's securities were completely wiped out by early 2008.
The judge said Pursuit and its lawyers had established probable cause to back up a claim that UBS employees "were in possession of material nonpublic information regarding imminent ratings downgrades on the Notes it sold" to Pursuit.
"The court takes UBS employees at their word when they referenced their Notes, these purported 'investment-grade' securities which they sold, as 'crap' and 'vomit,' for UBS alone possessed the knowledge of what their product, their inventory, was truly worth," he wrote.
The attorney's at Colling Gilbert Wright & Carter are investigating and filing FINRA arbitration claims against UBS and other brokerage firms that sold structured notes (PPNs, PPPNs and RONs) backed by Lehman Brothers and other toxic debt to retail investors. If you lost money in a UBS structured products, please contact our offices for a free case evaluation. Thank you.
posted by
William B. Young Jr. Esq.
at
5:51 AM
Wednesday, September 9, 2009
Lehman Brothers Executives Keep Low Profile Amid Bankruptcy and Lawsuits
As many an investor knows, the Lehman Brother Bankruptcy filing has left an indelible scar on both institutions and investors. Also, many wonder why the investment bank was not saved by the Fed.
The individual investor was particularly hurt by investing in Lehman unsecured debt that was packaged up by firms such as UBS as Principal Protected Notes (PPN's), Partially Principal Protected Notes (PPPN's), Return Optimization Notes (RON's) and Exchange Traded Notes (ETN's). UBS was not alone in selling Lehman debt as the firm's need for capital made the retail investor the last avenue of funding and the firm's peddling the debt were rewarded handsomely with high commissions and sales concessions.
So one year later, where are those executives that brought down the 150 year old bastion of Wall Street and what are they doing now? A recent a Market Watch article sheds some light on this question. Excerpts appear below.
SAN FRANCISCO (MarketWatch) -- A year after the collapse of Lehman Brothers sparked a firestorm in the global markets and threatened a financial meltdown, a few of the Lehman executives at the center of that conflagration are starting to resurface.
Former Chief Legal Officer Thomas Russo has a senior position at a New York law firm, while Jeremy Isaacs, who headed the firm's operations in Europe and Asia, has launched a new investment business. Even ex-Chief Executive Richard Fuld has a new job.
The first anniversary of the firm's collapse revives painful memories for those who have argued the investment bank shouldn't have been allowed to fail when such rivals as Goldman Sachs and Morgan Stanley were saved just days later.
The collapse of Lehman Brothers a year ago sparked a firestorm in the global markets and threatened a financial cataclysm. Even today the question remains, would saving Lehman have made a difference?
One former Lehman employee who didn't want to be identified said the bankruptcy was very painful for all of the firm's staff, and many just want to put the collapse behind them.
"I feel horrible," Fuld told Congress in October, less than a month after the bankruptcy. "What has happened is an absolute tragedy."
Lehman asked the Federal Reserve for help, but it didn't get much, Fuld said. But days after the firm filed for bankruptcy, on Sept. 15, the Fed and other regulators rushed to save Goldman and Morgan Stanley by granting them many of the things that Lehman hadn't gotten, he argued.
Lehman asked the Fed to let it become a bank holding company, which could have given the firm more access to deposits, considered a more stable source of funding.
Lehman also asked the Fed to broaden the types of collateral that could be used to tap the Term Securities Lending Facility, one of the main programs used by the government to boost liquidity during the financial crisis.
On the day Lehman prepared to file for bankruptcy protection from creditors, the Fed "significantly" relaxed those collateral requirements, Fuld recalled. "Had these changes been made sooner, they would have been extraordinarily helpful to Lehman."
As Goldman and Morgan Stanley shares slumped in the wake of Lehman's collapse, the Securities and Exchange Commission banned short sales, or negative bets, against roughly 800 of the largest financial-services stocks -- four days after the bankruptcy filing.
A few days after that, the Fed allowed Goldman and Morgan Stanley to become bank holding companies. See full story.
Most former Lehman executives are still keeping out of the limelight.
The Justice Department subpoenaed at least a dozen Lehman executives, including Fuld, Callan, Gregory and Ian Lowitt, a former co-chief administration officer at the firm, according to a Wall Street Journal report last October. Justice Department spokesman Charles Miller declined to comment and the Journal noted that it's not clear which executives are targets of the investigation or witnesses.
Richard Fuld, Chairman and CEO of Lehman Brothers Holdings, testifying at a House Oversight and Government Reform Committee hearing on the causes and effects of the Lehman Brothers bankruptcy, in Washington, Oct. 6, 2008.
In March, New Jersey's attorney general sued nine former Lehman executives, including Fuld, Callan, Gregory, Lowitt, Thomas Russo and Bart McDade, former president and chief operating officer of the firm.
New Jersey Gov. Jon Corzine, a former CEO of Goldman, said Lehman executives should be held accountable for "fraud and misrepresentation" that left his state's pension funds with more than $100 million in losses.
Matrix
Fuld recently started Matrix Advisors LLC in an office at 780 3rd Ave. in New York, a building that also is home to Paulson Investment Co. Inc., Renaissance Capital, Itar-Tass News Agency and offices of Sen. Kirsten Gillibrand.
It's not clear what Matrix does. A representative at the office said she would pass a late-August message seeking comment on to Fuld. Patricia Hynes, Fuld's lawyer, didn't respond to an email.
An executive at Renaissance Capital said he'd heard that Fuld operates from the building but hadn't seen him. The executive added that if someone had seen Fuld, he thinks they would have mentioned it.
Callan started at Credit Suisse in September 2008, running a hedge-fund advisory group. Callan advised hedge funds at Lehman before she took on the CFO position there in late 2007. At Credit Suisse, she coordinates departments to make sure that they are working well together to service hedge-fund clients.
In February, Callan took a leave of absence from Credit Suisse. A spokeswoman for the investment bank said on Aug. 20 that Callan was still on leave, adding that she didn't know why the former Lehman CFO was away from work. The spokeswoman also confirmed that Callan was still an employee of Credit Suisse.
Steven Eckhaus, Callan's lawyer, didn't return an email seeking comment.
Both Callan and Gregory left their posts at Lehman in June 2008.
Gregory, Lehman's former chief operating officer, doesn't appear to have taken another formal job. However, he remains one of the trustees of the Harlem Children's Zone, a charity that tackles poverty in Harlem, working alongside finance-industry giants including Stanley Druckenmiller, Gary Cohen, Zoe Cruz, Kenneth Langone and Richard Perry.
Gregory is also listed as secretary of the board of trustees at Hofstra University and as a member of the national board of advisers for the Posse Foundation, which promotes diversity at universities.
In August, Gregory filed a $233 million claim against Lehman's bankruptcy estate to recover equity-based compensation that he'd deferred while working at the firm.
MarketWatch phoned Gregory's home in Huntington, N.Y., and the woman who picked up said, "Gregory residence." She also said she would pass a message on to Gregory.
Thomas Russo, former chief legal officer at Lehman, is now senior counsel at law firm Patton Boggs LLP in New York. He also taught a course at Columbia Business School this summer called "Credit Crisis: As Seen Through Other Lenses."
Reading material for the course included a 2008 presentation Russo gave to the Group of Thirty finance and economic experts led by former Fed Chairman Paul Volcker.
Russo warned about the potential for broader trouble from the mortgage meltdown and said that any ways to boost liquidity and limit distressed asset sales should be considered.
Other suggested reading included articles on Bear Stearns and American International Group , two other financial giants that almost perished last year, along with stories on whether the Fed caused the financial crisis. None of the material focused on Lehman.
Herbert "Bart" McDade III, former Lehman president, helped integrate the firm's U.S. capital-markets business with Barclays Capital after the British bank Barclays PLC bought the unit out of bankruptcy protection in mid-September 2008.
McDade left Barclays Capital a few months later. He was reportedly hired earlier this year by Nomura to head up a securitization team at the Japanese firm.
Nomura spokesman Ralph Piscitelli declined to comment. An assistant who answered the phone at the front desk of Nomura in New York on Aug. 20 said she couldn't find a listing for Herbert McDade or Bart McDade in the U.S. or at any of Nomura's offices around the world. See related story on the Nomura and Barclays acquisitions of Lehman assets.
Jeremy Isaacs, Lehman's former head of Europe and Asia, started an investment firm called JRJ Ventures LLP late last year with Roger Nagioff, who'd headed Lehman's fixed-income division.
Should Lehman Brothers have been saved? We ask New Yorkers whether the collapse of Lehman Brothers should, or could, have been prevented.
Isaacs announced plans to leave Lehman just before the firm filed for bankruptcy.
London-based JRJ has 10 employees, according to the U.K.'s Financial Services Authority, which maintains a registry of regulated firms.
Other former Lehman staff at JRJ include Joanna Nader, Huarong Tang, Fouad Braidy, Era Sahni and Peter Sugarman, according to the FSA's register.
Going to Sears
Former Lehman co-Chief Administrative Officer Scott Freidheim was hired by Edward Lampert's Sears Holdings in December.
Freidheim was named an executive vice president for operating and support businesses at Sears. He also joined the retailer's internal holding-company business unit's board of directors.
He helps oversee Sears units that sell products and services including food, home appliances, home electronics, shoes, lawn and garden tools and sporting goods. Freidheim also helps oversee support units at the retailer, including information technology, legal, finance, marketing and human resources.
A Sears spokesman said Freidheim was unavailable for comment in late August.
Ian Lowitt, the other former co-Chief Administrative Officer at Lehman, joined Barclays in September 2008, soon after the bankruptcy.
That month, Barclays also bought the assets of Lehman's private-investment-management business in its Americas region. The deal helped the bank launch Barclays Wealth in the U.S. The unit provides stock broking, private banking, investment management and fiduciary services to people with at least $10 million in investable assets.
Lowitt became chief operating officer of Barclays Wealth in April. He oversees all infrastructure, including business strategy and development, finance, legal and compliance, human resources, information technology, marketing and communications.
A spokeswoman for Barclays Wealth said Lowitt was unavailable for comment in late August.
The attorneys at Colling, Gilbert, Wright & Carter are currently representing clients who have lost money in Lehman Brother's backed structured notes and products. If you feel the risk associated with these products was not fully disclosed or if you purchased a Lehman backed security in late 2007 or in 2008, please contact our office for a case evaluation. Thank you.
The individual investor was particularly hurt by investing in Lehman unsecured debt that was packaged up by firms such as UBS as Principal Protected Notes (PPN's), Partially Principal Protected Notes (PPPN's), Return Optimization Notes (RON's) and Exchange Traded Notes (ETN's). UBS was not alone in selling Lehman debt as the firm's need for capital made the retail investor the last avenue of funding and the firm's peddling the debt were rewarded handsomely with high commissions and sales concessions.
So one year later, where are those executives that brought down the 150 year old bastion of Wall Street and what are they doing now? A recent a Market Watch article sheds some light on this question. Excerpts appear below.
SAN FRANCISCO (MarketWatch) -- A year after the collapse of Lehman Brothers sparked a firestorm in the global markets and threatened a financial meltdown, a few of the Lehman executives at the center of that conflagration are starting to resurface.
Former Chief Legal Officer Thomas Russo has a senior position at a New York law firm, while Jeremy Isaacs, who headed the firm's operations in Europe and Asia, has launched a new investment business. Even ex-Chief Executive Richard Fuld has a new job.
The first anniversary of the firm's collapse revives painful memories for those who have argued the investment bank shouldn't have been allowed to fail when such rivals as Goldman Sachs and Morgan Stanley were saved just days later.
The collapse of Lehman Brothers a year ago sparked a firestorm in the global markets and threatened a financial cataclysm. Even today the question remains, would saving Lehman have made a difference?
One former Lehman employee who didn't want to be identified said the bankruptcy was very painful for all of the firm's staff, and many just want to put the collapse behind them.
"I feel horrible," Fuld told Congress in October, less than a month after the bankruptcy. "What has happened is an absolute tragedy."
Lehman asked the Federal Reserve for help, but it didn't get much, Fuld said. But days after the firm filed for bankruptcy, on Sept. 15, the Fed and other regulators rushed to save Goldman and Morgan Stanley by granting them many of the things that Lehman hadn't gotten, he argued.
Lehman asked the Fed to let it become a bank holding company, which could have given the firm more access to deposits, considered a more stable source of funding.
Lehman also asked the Fed to broaden the types of collateral that could be used to tap the Term Securities Lending Facility, one of the main programs used by the government to boost liquidity during the financial crisis.
On the day Lehman prepared to file for bankruptcy protection from creditors, the Fed "significantly" relaxed those collateral requirements, Fuld recalled. "Had these changes been made sooner, they would have been extraordinarily helpful to Lehman."
As Goldman and Morgan Stanley shares slumped in the wake of Lehman's collapse, the Securities and Exchange Commission banned short sales, or negative bets, against roughly 800 of the largest financial-services stocks -- four days after the bankruptcy filing.
A few days after that, the Fed allowed Goldman and Morgan Stanley to become bank holding companies. See full story.
Most former Lehman executives are still keeping out of the limelight.
The Justice Department subpoenaed at least a dozen Lehman executives, including Fuld, Callan, Gregory and Ian Lowitt, a former co-chief administration officer at the firm, according to a Wall Street Journal report last October. Justice Department spokesman Charles Miller declined to comment and the Journal noted that it's not clear which executives are targets of the investigation or witnesses.
Richard Fuld, Chairman and CEO of Lehman Brothers Holdings, testifying at a House Oversight and Government Reform Committee hearing on the causes and effects of the Lehman Brothers bankruptcy, in Washington, Oct. 6, 2008.
In March, New Jersey's attorney general sued nine former Lehman executives, including Fuld, Callan, Gregory, Lowitt, Thomas Russo and Bart McDade, former president and chief operating officer of the firm.
New Jersey Gov. Jon Corzine, a former CEO of Goldman, said Lehman executives should be held accountable for "fraud and misrepresentation" that left his state's pension funds with more than $100 million in losses.
Matrix
Fuld recently started Matrix Advisors LLC in an office at 780 3rd Ave. in New York, a building that also is home to Paulson Investment Co. Inc., Renaissance Capital, Itar-Tass News Agency and offices of Sen. Kirsten Gillibrand.
It's not clear what Matrix does. A representative at the office said she would pass a late-August message seeking comment on to Fuld. Patricia Hynes, Fuld's lawyer, didn't respond to an email.
An executive at Renaissance Capital said he'd heard that Fuld operates from the building but hadn't seen him. The executive added that if someone had seen Fuld, he thinks they would have mentioned it.
Callan started at Credit Suisse in September 2008, running a hedge-fund advisory group. Callan advised hedge funds at Lehman before she took on the CFO position there in late 2007. At Credit Suisse, she coordinates departments to make sure that they are working well together to service hedge-fund clients.
In February, Callan took a leave of absence from Credit Suisse. A spokeswoman for the investment bank said on Aug. 20 that Callan was still on leave, adding that she didn't know why the former Lehman CFO was away from work. The spokeswoman also confirmed that Callan was still an employee of Credit Suisse.
Steven Eckhaus, Callan's lawyer, didn't return an email seeking comment.
Both Callan and Gregory left their posts at Lehman in June 2008.
Gregory, Lehman's former chief operating officer, doesn't appear to have taken another formal job. However, he remains one of the trustees of the Harlem Children's Zone, a charity that tackles poverty in Harlem, working alongside finance-industry giants including Stanley Druckenmiller, Gary Cohen, Zoe Cruz, Kenneth Langone and Richard Perry.
Gregory is also listed as secretary of the board of trustees at Hofstra University and as a member of the national board of advisers for the Posse Foundation, which promotes diversity at universities.
In August, Gregory filed a $233 million claim against Lehman's bankruptcy estate to recover equity-based compensation that he'd deferred while working at the firm.
MarketWatch phoned Gregory's home in Huntington, N.Y., and the woman who picked up said, "Gregory residence." She also said she would pass a message on to Gregory.
Thomas Russo, former chief legal officer at Lehman, is now senior counsel at law firm Patton Boggs LLP in New York. He also taught a course at Columbia Business School this summer called "Credit Crisis: As Seen Through Other Lenses."
Reading material for the course included a 2008 presentation Russo gave to the Group of Thirty finance and economic experts led by former Fed Chairman Paul Volcker.
Russo warned about the potential for broader trouble from the mortgage meltdown and said that any ways to boost liquidity and limit distressed asset sales should be considered.
Other suggested reading included articles on Bear Stearns and American International Group , two other financial giants that almost perished last year, along with stories on whether the Fed caused the financial crisis. None of the material focused on Lehman.
Herbert "Bart" McDade III, former Lehman president, helped integrate the firm's U.S. capital-markets business with Barclays Capital after the British bank Barclays PLC bought the unit out of bankruptcy protection in mid-September 2008.
McDade left Barclays Capital a few months later. He was reportedly hired earlier this year by Nomura to head up a securitization team at the Japanese firm.
Nomura spokesman Ralph Piscitelli declined to comment. An assistant who answered the phone at the front desk of Nomura in New York on Aug. 20 said she couldn't find a listing for Herbert McDade or Bart McDade in the U.S. or at any of Nomura's offices around the world. See related story on the Nomura and Barclays acquisitions of Lehman assets.
Jeremy Isaacs, Lehman's former head of Europe and Asia, started an investment firm called JRJ Ventures LLP late last year with Roger Nagioff, who'd headed Lehman's fixed-income division.
Should Lehman Brothers have been saved? We ask New Yorkers whether the collapse of Lehman Brothers should, or could, have been prevented.
Isaacs announced plans to leave Lehman just before the firm filed for bankruptcy.
London-based JRJ has 10 employees, according to the U.K.'s Financial Services Authority, which maintains a registry of regulated firms.
Other former Lehman staff at JRJ include Joanna Nader, Huarong Tang, Fouad Braidy, Era Sahni and Peter Sugarman, according to the FSA's register.
Going to Sears
Former Lehman co-Chief Administrative Officer Scott Freidheim was hired by Edward Lampert's Sears Holdings in December.
Freidheim was named an executive vice president for operating and support businesses at Sears. He also joined the retailer's internal holding-company business unit's board of directors.
He helps oversee Sears units that sell products and services including food, home appliances, home electronics, shoes, lawn and garden tools and sporting goods. Freidheim also helps oversee support units at the retailer, including information technology, legal, finance, marketing and human resources.
A Sears spokesman said Freidheim was unavailable for comment in late August.
Ian Lowitt, the other former co-Chief Administrative Officer at Lehman, joined Barclays in September 2008, soon after the bankruptcy.
That month, Barclays also bought the assets of Lehman's private-investment-management business in its Americas region. The deal helped the bank launch Barclays Wealth in the U.S. The unit provides stock broking, private banking, investment management and fiduciary services to people with at least $10 million in investable assets.
Lowitt became chief operating officer of Barclays Wealth in April. He oversees all infrastructure, including business strategy and development, finance, legal and compliance, human resources, information technology, marketing and communications.
A spokeswoman for Barclays Wealth said Lowitt was unavailable for comment in late August.
The attorneys at Colling, Gilbert, Wright & Carter are currently representing clients who have lost money in Lehman Brother's backed structured notes and products. If you feel the risk associated with these products was not fully disclosed or if you purchased a Lehman backed security in late 2007 or in 2008, please contact our office for a case evaluation. Thank you.
posted by
William B. Young Jr. Esq.
at
8:58 AM
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- October 2009
- November 2009
- December 2009
- January 2010
