Fingerpointing and a more in depth look into the Lehman Brothers company documents was primary on the agenda at the first hearing of Congress, about the cause of America's financial market collapse last month.
Lehman's last hours were disclosed as being somewhat chaotic by Rep. Henry Waxman, D-Calif, who chairs the House Oversight and Government Reform Committee. He reportedly read excerpts from Lehman documents that revealed the company was heaping bonuses and special payouts on top executives while reaching out to government for a federal bail out just before the company crashed.
The tumbling down of Lehman sent shockwaves that prompted President Bush and Treasury Secretary Henry Paulson to ask Congress to pass the rescue plan for the financial sector.
Chief Financial Officer of Lehman Brothers, Richard S. Fuld jr was amony the first set of witnesses who testified. His prepared statement spoke of his deep remorse for what had taken place.
Waxman unveiled information about a September 11 request to Lehman's compensaion board to give $20 million in special payments to three executives leaving the company. He told Congress that Fuld was squandering millions on compensations to 'top brass' while pleading for federal rescue. Lehmann went under on September 15.
The company that operated as a global financial services firm and had done business in investment banking, equity and fixed income sales, research and trading, investment management, private equity and private banking; and as a major dealer in the US Treasury Securities Market was taken over on February 16 by Barclays plc and others who announced plans to purchase Lehmans.
Fluid said in the end they were simply overwhelmed and other institutions would also have been overwhelmed if placed in the same position.
The federal government did bail out insurance giants American International Group (AIG) the day after Lehman went down.