Lehman CEO Dick Fuld resurfaces
“Where’s Dick?” has been a question swirling around Wall Street ever since Monday morning when Lehman Brothers (LEH) filed for bankruptcy. As I reported, there’s not been a word from the man who commanded the firm for 15 years and, as many now see it, leveraged it into the ground. Last night, finally, a “Dear Colleagues” letter popped into the mailboxes of Lehman employees (at least those whose e-mail was still functioning). The note included three paragraphs or so. Fuld said that he felt “horrible” about what happened. The general response: anger, according to multiple sources.
While Fuld reportedly has been in his 32nd floor office at Lehman at least part of this week, he’s been invisible to employees, even senior managers. He wasn’t part of this week’s negotiations with Barclays (BCS), which agreed to buy a stripped-down portion of Lehman’s North American business for $1.75 billion. In Fuld’s stead: Bart McDade, his recently appointed No. 2, who worked out the deal with help from three other prominent Lehman executives: mergers-and-acquisition boss Mark Shafir, global investment banking chief Skip McGee, and Mark Shapiro, head of the firm’s restructuring and finance group. After a deal to sell Lehman in its entirety to Barclays collapsed last Sunday, this is a Hail Mary solution that should save the jobs of some 10,000 Lehman employees. That’s nearly a third of the firm’s total workforce.
While McDade, said to be looking 10 pounds lighter and unshaven this week, is now viewed as the man who rescued at least part of Lehman, the other savior on the scene is Barclays president Bob Diamond. He appeared at Lehman yesterday afternoon and reportedly told a gathering of employees that he has “a ton of admiration” for their businesses. He called Barclays’ acquisition “a once-in-a-lifetime opportunity,” scoring points by donning green cuff links — Lehman’s color.
Meanwhile, Fuld is expected to reapppear next week, in Washington. He’s been called to testify before U.S. Rep. Henry Waxman, the California Democrat who runs the House Committee on Oversight and Government Reform. Fuld is supposed to explain what led to Lehman’s collapse and explore the impact on financial markets and the U.S. economy. As my colleague Colin Barr pointed out yesterday, this is not a forum for image-remaking. Dick Fuld’s reputation is ruined, probably permanently.
The money Fuld took out of Lehman (stole?) is more than than just a paycheck you and I get for showing up to work and at least doing an ok job. When you’re making that kind of coin, it’s a contract. If you provide competent management, you will be handsomely rewarded. Fuld didn’t provide the competent management, he defaulted on that contract and should have every penny reclaimed and put into this $700 billion mess.
I bet Dick is hoping he’s not left standing when the music stops. Someone has to go to prison for this mess, he seems like a good candidate to me.
I Own a small Drive-Inn and do you think if I go broke because people dont have money to eat out, that I’ll get a free $400,000 trip no!!! Do you now what hard working people get??? Nothing!!! If we go broke its no vacation for us, its a lifetime of struggle!!!! What about these small business???? How come everyone bails Million Dollar Componies out so they can take a vacation. I have worked since I’ve been 12 years old sometimes 3-4 jobs just to support our family and you now what I’ve never had a vacation so what does this tell us all…Something is screwed up!!!!!!!!
Gina, your idiotic comment is why Americans have been led to the slaughter and not know it, until they cannot pay bills, or feed our kids. This mans job was based on keeping the best interest of his trusting clients money and protecting it. He not only failed, he is a criminal. Please wake up and fight for good in America. We need a complete washing of our financial system and the politicians and other crooks, that look to profit from we the average American.
I really enjoy the comments that blame middle America for the current crisis. I too manage my money well. But by no means do I consider this melt down the responsibility of middle Americans.
These are the same Americans who haven’t see a real wage increase in 8 years. They don’t get billions of dollars in bonuses in January for pushing paper spread among a very small group of people.
I’ve seen a Wall Street Scandal at least once a decade for the last 30 years. But this is a first, where these masters of the Universes are laying blame for this mess at the feet of middle America.
What these people are saying is don’t trust a banker or a used car salesman. In fact trust a banker less. A used car salesman will only sell you a lemon. A Banker will sell you money under terms that will ruin your life to for a few hundred basis points in extra profit.
Alright , us middle Americans get the message. Bankers are worse than the average buy-here-pay0here used car salesman. It’s too bad we all have to pay for this knowledge with tax dollars from paychecks that don’t even cover basic living expenses.
It shall be burned into the brains of starting in high school. Never, ever trust a banker. Even when it comes to shelter that is a basic human need.
Don’t trust a banker or a broker for financial advice. of any kind. Don’t trust a banker or broker to help you navigate the increasingly complex world of financial products.
For God sakes don’t lend a banker any of your money either. They can’t pay it back with this idiotic fractional reserve system that has them leveraged 18:1. Can you iamgine owing 18.00 dollars for each dollar of asset that you have? My God. No one would ever allow that!
If you think the govt will protect your on-demand loans to a banker consider that the Govt has also jumped into the financial cesspool with a debt so gargantuan it can never be paid back.
Why would they be able to guarantee you loans to a banker who is lower than a used car salesman.
Buy a used Car from eBay and don’t trust brokers or bankers with your money. That’s what they are telling you because if you hadn’t trusted the brokers or the bankers, this problem wouldn’t have happened. Boy are we stupid.
Now that we know, I suspect the help these bankers seek will be harder to come by. After all they can’t be trusted. They just told us that. Don’t let them prove it again.
A bunch of sincere folks on here, I just wish you knew what you are talking about:)
I admire Mr. Fuld and and believe that everything he has done was intented to be of best interest for Lehman, HE didn’t fail….the system DID,
Stop blaming him for what happened, he was with LEH for 30 years 15 of which calling the shots…pretty succesfully too ….imagine how he feels right now,
You can call him whatever, in my books he is one of the brightest and always will be !!!!!!!!!!!!!
Yeah,sure…He was a devote in filling his own pockets… Is not more than a criminal. Why the U.S. Governement don´t say to him to payback the money who get? He and his executives.
Who is next? Dick,with tears in his eyes infront a camera? Come on!!!!
Don´t be stupid… He was so clever to manage a company and so stupid for don´t see the crisis???
Give me a breack
With $480 million in his back pocket, I imagine Dick isn’t too worried about his reputation being ruined.
At the risk of upsetting all of you financial geniuses out there, I’ll tell you all straight up and honestly who is to blame for this financial catastrophe. Everyone that thinks they can get “free” money by charging “usury” to the common man or struggling business. Greed caused this mess and greed will continue to have its effects felt as long as there are these types of people. As long as there are people who want something for nothing and a government that allows it, we will have this boondoggle. A blind man could see it…it is the American way to want something for nothing or pay just a little less for things than the next guy. We have sold out our own country because of greed and the thought that “we” are special and everyone else can go fly a kite. We have bought foreign cars from Japan, foreign clothes from Mexico and China and we continue to pump all our money overseas to save a buck rather than buy American and save our country. I’m quite sure that all you suits will say it’s got to be something really complicated (that we should form a “committee” and analyze it!) or some such nonsense. The real truth is that no one wants to work anymore and everyone seems to think that they are “special” and deserving of some astronomical paycheck just for showing up for work. Get a clue! or get in the unemployment line.
I am so sick of reading the ignorant statements of people who dont understand enough about the financial system to understand that what happened is not merely the result of “crooks on wall street”. Dick Fuld is a dedicated CEO who devoted his entire life to building Lehman Brothers into the sucessful institution that it was over the last several decades. None of you stock holders were complaining 2 years ago while your stock was at $80 a share were you? Everyone was singing his praises but now that he has failed to navigate what is universally agreed upon to be one of, if not the MOST difficult financial environments of the last 100 years, people are happy to call him a crook. The guy is human and like so many other smart investors, failed to see to extent of the trouble facing US creditors and the economy at large.
I had part of my money invested with Lehman in preferred stocks and that was my retirement nest! I am almost 70 years old and it is very unfair what happened to people like me who trusted the system and found themselves screwed and forgotten.
They should give our money back we are innocents victims of the dishonnesty of these crooks.
I see several points of view on here variously blaming: the govt., Wall Street, main street. What no one has said yet, is that all are to blame. The govt. (not Bush, blaming him is a panacea for whatever is wrong) meaning both branches, both parties have failed miserably regarding understanding what was happening, and regulating it. Wall Street is guilty of abrogating what is probably their most important resposibility as and to investors: identifying, planning for, and minimizing risk. And main street is responsible for not doing their due diligence so that they understood the markets (real estate) and contracts (mortgage loans) that they were party to. And really, it’s all about a lack of due diligence in each case. The information was there to be had, but NO ONE wanted to get off that carousel because the ride was too much fun. We all have responsibility for this mess to some degree and now we need to quit pointing fingers and deal with it.
A little perspective on blaming mortgage brokers. 1st- brokers do NOT set the guidelines for loan programs, investors do. 2nd- if someone walks into a brokers office and qualifies for a loan program and the broker refuses to do the loan, he/she can be sued for discrimination. 3rd- ignorance of the terms of a financial transaction that you choose to participate in is your responsibility. When did we start blaming others for our own ignorance. Blaming brokers is akin to smokers who contract cancer blaming the 7/11 for selling them the cigarettes.
Mr. Fuld and all the other senior executives on the Street were playing by the rules of the game as set by Congress when they repealed Glass Steagal. Sure they lobbied for years to get it overturned. As capitalists, we all push whatever envelope were are dealing with and that’s all they did. That’s not a crime. It’s a shame that this happened and happened so quickly but it’s just a small part of the decline in America’s dominant position in the world started when Bush stole the 2000 election. Get over it!
It is VERY important to realize that those (below) average Americans wanted what MOST Americans wanted- their own home. Because of their naivete, they typically assumed that the “smart” banker KNEW how much home they could afford, and would only give them that much money. What they did not know was that the “smart” banker DID know what they could afford, but fashioned a loan program that would work for 6-months or a year before blowing up- well after the “smart” banker had sold the paper to another “smart” banker. GREED will always lead to a bad ending for someone- usually NOT the first player.
Point well taken….let’s not lose sight of the fact that the “toxic mortgages” were originated by (below)average Americans who allowed themselves to be talked into something they knew they could not afford. It is time for these people to take responsibility for their actions and live with the consequences. It is time to stop blaming McDonald’s for your obesity problem, the shady mortgage broker for your ignorance and the banks for throwing you out when you don’t pay your mortgage!
THe Wall St. “bailout” is actually a rescue plan for the American economy and not a handout to Wall St. bankers. If a plan is not passed by the (nearly incompetent) government of this country not only will Wall St. continue to crash but try getting a loan to buy your John Deere tractor in Iowa! Wake up people it’s time to start thinking clearly and be responsible for yourself.
Mr. Fuld should be wearing a sackcloth and ashes for the rest of his sorry days, for co-leading the US’ and the worlds cremation of Capitalism.
Everyone should pay full restitution to the companies they have “hedged into the ground” and pay full consequences for their greed.
No Bail out should be offered PERIOD by Paulson, Bernanke, and the lame duck presidon’t Bush.
These greedy institutions have bet,gambled and behaved like drug addicted junkies.
They need to file for bankrupcy if that is necessary , but any golden papachutes paid out to any CEO,COO, CFO in the years leading up to this need to be forfeited or paid bach in punitive restituion. They need to be prosecuted as do the politicians proposing horrible “rescue rewards”.
Let’s face facts. “Educated” Americans are vastly outnumbered by clueless idiots. People with a clue live amongst a neighborhood of sheep who just want their piece of the pie. Look at how many people voted to re-elect GWB! It is the job of the educated minority to protect ourselves and the masses – the majority of idiots – from ourselves. There are many idiots out there and we need good, well enforced policies in place to prevent these idiots from making bad decisions, not to mention preventing soulless money grubbers from fleecing them and the system. Suckering an idiot into accepting a mortgage that he or she cannot live up to is not the fault of the idiot.
Hey Charley in Charlottsville:
I think they should be hung for treason too.
They knew exactly how to suck out money thru these loans to squeeze the little people into loans with high points and fees,stuck with mortgages they knew these people coould never pay after the teaser rates settled.
IMO the people should keep the loans at the teaser rate for 5 years so things settle down and they can sell or refinance.
Let the investors suffer rather than the home owners – they bought into somthing that was literally too good to be true. How American is that these days…everyone is white hot from greed, unable to think ahead.
Any person who is employed just to make money IMO is a thief. If there is a service they provide then pay them fair but there has to be caps on these liar loans and an end to the scams.
Silly Question: Do you really think Sarah Palin has a clue about any of this?
I like dick fuld. He has all you idiots debating whether or not he is good or bad. He lost 650m. True. But over his tenure he made 450m +
dick will enjoy the rest of his life. Will you ?
Chris for NY: I think you have nailed the issue more than anyone. People tried to live in McMansions with the latest technology and could not afford it. To keep up with the Jones’s they charged up credit cards irresponsibly and took out a second on their house to pay those debts and the snowball keeps rolling. Plasma TV’s to jewelry they could not afford these things, making matter worse they did not understand their loan would triple in a short time. GW Bush did not go to these closings nor did Congress. The Govt should not control 3/4 of the mortage market, think of the stupidity Washington would do with that money.
The brokers knew they were selling crap but figured not everyone would default at once(great thinking) when rates reset. They figured the house would resell in a week and they would make even more profit. They have some moral culpability, but the borrower still bears the brunt of it. I live in a nice area of Dallas in a modest house, no mansion, and my value has really edged up. I carry little debt, credit cards get paid without paying any interest, and i do not need a 50′ plasma so my neighbor can see that i make money, i could care less what he thinks. Hell, i even drive a Ford Focus, nice car really nice by the way, and paid all but 18 months by cash. My dad has always said, “if you do not have cash you do not need it, he is a doctor though”, but still instant gratification leeds to more misery later from what i have seen.
As for the London person, a heck of a lot of folks get burned by emerging markets. They want western nohow and money, and when it is really profitable they nationalize the thing. The Soviet Union has done this, Venezuela(much less success his oil industry is almost at a standstill since Conoco was kicked out). I only invest in Western Govt companies and do just fine. Emergers may start out well, but once the their politics kick in your investment in their companies might be wiped out. This year will kick all of our butts in the market but you have plenty of time to recover and if you invested in the 80’s you have made many 3 baggers.
He called Barclays’ acquisition “a once-in-a-lifetime opportunity,” scoring points by donning green cuff links — Lehman’s color.
really? that’s all it takes to score points on Wall Street?
- No what he was saying was, “I just got your bank for something less than I paid for these cuff links”
It’s Wall Street’s fault for packaging risky loans and reselling them as safe investments. Any 10 year old could research them to understand they were a poor bet. Put the people who wrote those loans in prison. Ban the investment bankers who sold their snake oil from working in financial services.
To all of the vindicative posts – what a bunch of useless drivel. Everyone keeps on talking about all of the “greed and corruption” of Wall Street. Let’s get down to brass tacks, this whole crisis is the result of “middle” America taking out loans that they couldn’t afford and buying houses and cars they had no right owning. That’s where the heart of this greed lies. Stop blaming Wall Street for your own inability to be fiscally responsible.
One of the problems with American capitalism is that the business press Fortune included are unrelenting and uncritical cheerleaders of the chase profits and damn everything else mentality that dominates virtually all American business. Well now the chickens are coming home to roost and the same press is just as clueless as to how this has happened. Wall street apparently hires some of the smartest guys from top US colleges yet on the evidence there is little to suggest that much intellect is at work. America is losing it’s global leadership and competitive position and by the time US leadership wakes up the Chinese the Indians et al will have taken over. The writing is on the wall.
To be fair, he did lose nearly $1 billion when Lehman went bankrupt – that has to count for something, right?
To those on MAIN STREET:
Do some research…
Dick Fuld lost over $650 million in Lehman stock.
The vast majority of his wealth.
I think Mr.Dick Fuld did what he could do in his means. He lead the company for 15 years successfully and shared dividends and bonuses with shareholders and employees equally.
Now that the market has turned bad and took a toll on Bear Stearns, Lehman and now Morgan Stanley we should not blame CEO’s for it specially Dick Fuld who led the company by setting examples.
How about Dick Fuld for president???
I really wish all the senior execs like joe gregory is sued and deprived of every penny they stole from investors, employees, customers and the govt.. bet they hardly pay any taxes either.. Tyco, worldcom, Enron, dot-com, real estate bust, private equity/hedge fund, lehman,.. And you call this the developed world?? I would much rather put my money in emerging market
This guy should be executed for high treason and fraud. What these CEO’s and the rest of their cronies are costing this country so he can have 4 multi million dollar homes is unimaginable.
Yeah, they guy will really be hurting.
From CityFile New York
Fuld and his wife Kathy own an estate in Greenwich. In February 2007, they purchased a “fixer-upper” at 640 Park for the bargain-basement price of $21 million; construction on the 16-room, full-floor apartment took more than a year to complete. Fuld and family spend vacations at homes in Florida (they paid $13.75 million for a spread on Jupiter Island in 2004) and Vermont.
I have been laughing for 3 days now! These are the same Wall Street folks that have been putting you and I out of work for years, and stealing our pension plans, carving up our companies, selling off profitable divisions, all to make their QUARTERLY bottom line look better. Screw the employees! Screw the American public! Screw each other! Screw it all — Just Make A Profit. Now, that’s NOT what they teach at Sloan. That’s NOT what they teach at Harvard. All of these Wall Street MBAs that have driven our financial prowess into the toilet, EACH made the unethical decision to leverage their collective butts to the hilt, along with millions of small investors, only to have it come crashing down this week. LOL!
He’s banked millions and millions of dollars each year.
The failure of his and other firms don’t matter because they made their money, along with all the managers.
It’s the investors and taxpayers that got screwed.
Jail isn’t good enough for these guys. There is a special place in Hell waiting for their corrupt and greedy ways.
Capitalism is not supposed to work like this. There is ‘greed’ but it’s greed to make money within fair and competitive means that are honest and without lies and deceit. What we’ve had is pure ‘GREED’ on the part of Wall Street..which is completely against the foundations of Capitalism.
The lawyers are keeping him quiet, he can’t talk.
He doesn’t care… he’s got all the money in the world! Greedy bastard!!
“Dick Fuld’s reputation is ruined, probably permanently.”
No, you think? Can’t imagine why. I mean, it isn’t like he was part of destroying the largest investment bank, only the fourth largest. Piffle. He is a real diamond in the rough.
Sounds like “The Gorilla” won’t be making a stern impression at any more board meetings.
Good riddins to bad rubbish. He ran the company into the ground and fell victim to his own hubris.
Regarding your comment that
“Dick Fuld’s reputation is ruined, probably permanently”.
What – are you kidding ?
Wall street is so totally clueless that this guy will probably be back in the corner office – running some other financial giant in no time.
That Wall street allowed this nonsense to go on unabated until all these major outfits went under – speaks volumes.
Rob
He called Barclays’ acquisition “a once-in-a-lifetime opportunity,” scoring points by donning green cuff links — Lehman’s color.
really? that’s all it takes to score points on Wall Street?
you sycophants have really lowered the bar….
the last sentence read “Dick Fuld’s reputation is ruined, probably permanently.”
As it should be.
I am sure his reputation being ruined will really hurt when he is sailing around the world to one of his many homes. The only way to hurt this guy is to take his money.
“Dick Fuld’s reputation is ruined, probably permanently.” You would be suprised wall street tends to have a very selective memory…If your going to go out..go out with a bang as they say. Fuld will land a job at a hedge fund advising the fund on how to price lehmans assets…
Poor Richard Fuld. I feel my eyes filling with tears at the thought of his suffering. How mean-spirited of Hankie and Bernanke not to use more of my money to bail out Lehman.
Oh Well…I guess Mr. Fuld will just have to resign himself to a life of obscurity golfing? fishing? or? in Scottsdale or Naples. Life $ucks.
He will probably have another high paying job within a year or two. Then he can do it all over again to the common workers.
Esther Wojcicki: The last newspaper generationJournalism teacher and newspaper adviser at Palo Alto High School
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Did Fuld lose $650 million or $1 billion? Who cares?
Does anyone remember Enron and their mgmt team. Well, if you don’t, Google Ken Lay and Jeff Skilling. Then let’s remember the words and actions of Ken/Jeff and Dick/Joe.
Why is Fuld not in Jail or at least being sued just like Lay?