As Digby noted, hopefully this will speed up the Congress doing something about financial reform. Dylan Ratigan talks to Eliot Spitzer about the release of a 2200 page report detailing a potential criminal case against Lehman Brothers.
The bankruptcy examiner’s report filed by Anton R. Valukas on the 2008 demise of Lehman Brothers discusses some accounting gimmicks that are eerily reminiscent of how Enron tried to prop up its balance sheet back in 2001 before it collapsed.
Both companies appear to have played right along the edge of properly accounting for transactions designed to make them appear much stronger than they turned out to be, becoming steadily more aggressive as they teetered on the brink of ruin.
The examiner’s report discusses potential claims that the bankruptcy trustee can bring against Lehman’s former officers and outside advisers and does not mention potential government law enforcement action. Reading his report, however, gives strong indications that at a minimum the Securities and Exchange Commission is likely to pursue civil charges for securities fraud, and that criminal charges are certainly possible against Lehman’s former top executives.