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Lehman chief berated over huge exec bonuses

The US House Oversight and Government Reform Committee has attacked Lehman Brothers chief executive Richard Fuld for authorising huge bonuses for departing exec-utives in the run-up to the bank’s collapse.

Fuld came under fire from committee chairman Henry Waxman during a grilling this week in Washington in the first of a series of probes into the collapse of the bank.

Waxman criticised Fuld for continuing to seek multi-million dollar bonuses for departing executives in the run-up to the collapse. “In other words, even as Mr Fuld was pleading with Secretary Paulson for a federal rescue, Lehman continued to squander millions on executive compensation,” he said.

Fuld was personally criticised for taking more than £178m in pay and bonuses from the bank since 2000 but he denied taking the committee’s initial estimate of £276.2m.

He said: “I think for the years you are talking about here, I believe my cash compensation was close to $60m [£34.5m] and the amount I took out of the company over and above that was closer to $250m [£144m]. Still a large number, though. I want to be very clear. I take full responsibility for the decisions that I made and for the actions that I took based on the information that we had at the time.”

Fuld pointed out that executives of Lehmans owned a big proportion of shares to ensure they acted in the best interests of shareholders.

He said: “We had a compensation committee that spent a tremendous amount of time making sure that the interests of the executives and the employees were aligned with shareholders.”


Take that to the bank

The news that B&B needs rescuing by the Government makes me wonder if the FSA would not have been better dealing with properly inspecting the banks pre-crisis and truly understanding what they were up to.

Personal attention

The Government is committed to launching personal accounts in 2012 to complement workplace private pensions.

India GDP surprise

By Kunal Desai, head of Indian Equities, Neptune Kunal Desai, manager of the Neptune India Fund, comments on the strength of India’s latest GDP figures. Click here for more Important Information Investment risks The Neptune India Fund may have a high volatility rating and past performance is not a guide to future performance. The value […]


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