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Dick Fuld: Scapegoat or villain?

September 7, 2009

Nearly a year after the collapse of Lehman Brothers, a failure that triggered the global economic crisis, the much-lambasted chief executive Richard Fuld seemed burdened — but not crushed — by the pressure of the upcoming annivesary.

“You know what, the anniversary’s coming up,” he told Reuters. “I’ve been pummeled, I’ve been dumped on, and it’s all going to happen again. I can handle it. You know what, let them line up.”

Fuld, a nearly 40-year veteran of the company, took Lehman’s reins in 1994 at one of its darkest hours and rebuilt it into the fourth-largest U.S. investment bank, a Wall Street powerhouse whose massively profitable mortgage banking machine inspired rivals’ envy.

But after filing the biggest bankruptcy in U.S. history, Fuld was vilified and humiliated before a Congressional panel last October and named in nearly 40 different legal actions.

Opinions are still divided over his role in the disaster, but he doesn’t see the point of speaking out: “Nobody wants to hear it. The facts are out there. Nobody wants to hear it, especially not from me.”

Is he the scapegoat of a massive systemic failure on Wall Street, or does he deserve to be a central villain in the collapse?

Comments

Dear CNN and readers,I refuse to feel sorry for Fuld with his house on a river in Idaho and one in Connecticut. And what is he doing back on Wall Street dining in fancy restaurants in New York? Probably doing more bad stuff.He and all of his cohorts should be in jail and the kind of jail regular people go to, not some cush white collar jail.We shouldn’t even give these greedy people any press.

Posted by Dru Murray | Report as abusive
 

No more a villain than most others on Wall Street – and probably pretty representative of the CEO mentality…It seems plausible that to an extent Fuld was a victim of an out of control system. However, his strategy for Lehmans was clearly a ‘pedal to the metal’ one, and as such was necessarily high risk.I am sure he was warned of the risks involved, but was not able to absorb the warnings just as most if not all of the others didn’t. Why? Perhaps because the system that produced Fuld is set up to reward high risk taking and short term thinking.

Posted by Geoff | Report as abusive
 

The article suggests the collapse of Lehman triggered the global economic crisis…..All it really did was expose a high form of grand theft…..while brother Fuld sits at his expensive property in Ketcham contemplating his new venture (Matrix), the people who are paying for this are middle class investors who lost their nesteggs in this grand theft….he should really be in jail with a lot of others who got rich at our expense……

Posted by Todd Spare | Report as abusive
 

I find it amusing how these ‘tough’ guys whine and wallow in self pity.It’s every bit as impressive as their performance.Perhaps we ought begin constructing the guillotines, if only to diminish the din.

Posted by Not Silent, Not Bob | Report as abusive
 

Its real easy to find someone to point and shake our fingers at after the fact. Everyone got on the re-fi band wagon and everyone needs a boogy-man to justify getting burned. Shall we be reminded that, ” investing is risky business”. The warning signs have been flying for a long time, yet we ignored them. Scapegoat indeed

 

What is sad is he does not seem to have even a word of sympathy for all those people who lost jobs and life savings? Guilty or not guilty he is quite well off and the small investor who trusted lehmann has to fight to survive.He is not the scapegoat, the scapegoat are the employees and average citizen who keep getting punished due to the gambles of men at top in firms like lehmann,enron, tyco and the list goes on.To say he also lost money an is not taking private jets seems kind of a joke..

Posted by mosurh | Report as abusive
 

Looking into eyes in the picture, he is definitely a villain, a grand thief.

Posted by b.madoff | Report as abusive
 

I’d rather hear Fuld’s story on Lehman rather than any of the senators, journalists and commentators who constantly talk about this subject.Considering how incredibly complex his company was, he is probably one of the few people that could really articulate what really happened and why it happened. I would prefer to hear his story far more than any of the previous stories i’ve read on Lehman’s demise.If people truly don’t want to hear his side of the story, we will probably stumble over the same problems in the future.

 

we live in a world mired by idiots from wich we must emerge through our own intellectual salvation.

 

It’s a really tough sell!This guy, among others, destroyed our economy. People are really suffering because of his actions. I’m sorry he had to sell his $25 million penthouse and may have to sell another of his many properties, however thousands are losing their ONLY home because of his actions or lack there-of.I wonder how his bank handled it when someone fell behind on payments through no fault of their own (like this economy he helped create)? Were they as understanding as he would like us to be of him?Just another ripoff artist…

Posted by Dale Miller | Report as abusive
 

I think the notion that this guy should have any sympathy ridiculous. He “rose to power” by putting undue risk on the company he was hired to shepherd and now he blames the Feds for not bailing Lehman out of the result of his bad management?Yeah, good luck with the consulting gig.

Posted by rich | Report as abusive
 

its hilarious to see how people mention the ones who have lost millions in stock and gone bankrupt while fuld lives in his mansion. but you forget who it was who quadrupled lehman’s stock price, who saved a company from bankruptcy and who worked days straight to prevent mass panic during 9/11. without these bankers, we would never have gotten to the position of strength that we are in now. now that we’ve lost that strength, we find the closest, easiest people to blame it on

Posted by will | Report as abusive
 

Until the American people decide they will no longer tolerate this behavior we will always be on the short end. If you can’t afford to lose it, don’t risk it… but rest assured there will be someone who will risk everything and point their finger at others when they fail rather than take personal accountability.That being said… a hard message needs to be delivered to everyone about sacrifice, personal accountability and consequence.

Posted by mutineer612 | Report as abusive
 

Well ..Everybody here speaks as if a year back they were making money with the Morgan Stanleys and Goldman Sachs of the worlds and Lehman was the only one responsible for all the market crash.Think it this way, had Lehman been bailed out like the other crooks(i’m not a pro-lehman too), it would also have been a contributor to improving financial market. The current balance sheets of all the bailed out financial firms is the proof.

Posted by bad_times | Report as abusive
 

I’d say he’s a scapegoat. Merrill, Bear Stearns, and Goldman (and every other I-bank out there with no commercial bank deposit base) took on just as much risk as Lehman. I’m no conspiracy theorist, but I do find it interesting that Lehman (who was challenging Goldman’s power on the street) was the only bank that did not receive any kind help from a government that is laden with former Goldman employees. In my opinion, we should spend less time criticizing a guy who already lost his job and no longer affects our money and spend more time looking into why his company was the only one allowed to fail.

Posted by Casey | Report as abusive
 

If Lehman had been bailed out would the collapse have been softened or just delayed? Watching the fall of Lehman pulled off the mask of many posing as “Masters of the Universe”. Maybe others including Goldman have been treated better and Fuld has something to contribute in telling the overall story but he has no legitimate claim to any sympathy from me.

Posted by reginald | Report as abusive
 

They are all a bunch of useless crooks that we have allowed to get too big!Investment bankers are nothing but a bunch of used company salesmen, churning the ownership of other people’s accomplishments from one frat buddy to the next while skimming the cream of the top of the transaction.They make a lot of money you say? Bankers don’t “make” anything! They only take. At the end of a bankers work day, nothing exists that was not there the day before.Let them all collapse.

Posted by tony | Report as abusive
 

A certain percentage of the populace simply lack all empathy and conscience — and far too many of them hold inordinate power, because they’ll do anything to get it and hold it. When they’re caught, these sociopaths always whine, blame others and rationalize their own behavior.The rest of us need to get better at spotting them before we’re totally screwed.

Posted by Erin Harris | Report as abusive
 

As one of the people who had money swindled away by Lehman bros. collapse, I can safely say that Fuld deserves to be drawn and quartered. But let us no forget all the Goldman Sachs cronies in the Bush administration and the Treasury who allowed this swindle to happen. They too deserve to a similar fate.

 

Come on people wake up!!! While Fuld is no angel, he was brought down deliberately by Paulson who was working on Goldmans behalf….Just take a second and look at the bigger picture. Who has benefitted more from Lehman’s downfall than anyone? GOLDMAN. They are now left with a stranglehold on the entire financial system….Do you really think that is coincidence? Henry Paulson CHOSE not to help Lehman…He wanted to teach them a “lesson”. What about Goldmans’ lesson? Well Goldman was given the opportunity to turn itself into a “bankholding company” which then made it possible to recieve TARP money…..WHEN IS THERE GOING TO BE A TRUE INQUIRY AS TO WHY LEHMAN FAILED and the rest were propped up? I’m sure Fuld is preparing himself for that day of reckoning. Go back and watch the congressional testimony when Dennis Kucinich REPEATEDLY asks Richard Fuld “why was Lehman not bailed out?” You can see the rage in Mr Fuld’s eyes…He KNOWS WHY!!! But for whatever reason he doesn’t dare say it. I want to know when HENRY PAULSON, the man that was at the helm of this complte financial collapse is going to be held accountable and Bernanke and Little Timmy Geithner!!! Richard Fuld was thrown under the Wall street bus, by his competitors…Did he deserve it? Maybe, but so did the rest of the LYING CROOKS especially those rewriting the regulations…OR LACK OF!!! AND THE ONES WHO HAVE MIRACULOUSLY HAD THE MOST PROFITABLE LAST TWO QUARTERS IN HISTORY!!!!!!!!! FOLLOW THE MONEY…..

Posted by L Marceau | Report as abusive
 

Americans, on the whole, don’t believe in ‘Government’. They believe in ‘Capitalism’. Is it really surprising, then, that the folks in the position to control capital, most visibly perhaps the investment bankers, are the most influential decision makers in society?If Americans don’t like it that way they will have to accept some form of populist revolution. Realistically, that isn’t likely.Realistically, the financial/governmental complex will look to its own elite interests and continue to successfully pander to the worst of the instincts of the broader populace.Welcome to American Democracy.

Posted by My Dog Fred | Report as abusive
 

Dick Fuld: Scapegoat or villain? Hmmmm…..let’s see….seems like a no brainer to me.

Posted by What do you think? | Report as abusive
 

Since the financial deregulation instigated by Reagan, the American economy has become a casino. The Fed/Treasury bailout system rigs the casino if favor of the house – the banking house – at taxpayer expense. Until Americans stop projecting their visions of wealth on the very few Masters of the Universe at the top, the system will continue to work.Since Reagan’s presidency conservatives have tried to sell Americans on the notion that democracy equals capitalism – an historically false idea. It will take awhile to undo that misconception, a misconception relentlessly promoted by news outlets like Fox and CNBC.

Posted by C S | Report as abusive
 

Look – I don’t know if Dick Fuld is a nice guy or not. Maybe he is. This, however, is irrelevant.The point is simple. HE was the head of his Lehman – and he received millions (scores of?, hundreds of?) for leading it, and HE led it into total disaster that was a large part of the meltdown of the American and World economies.Now he is playing the “not MY fault” game. I can’t really blame him, this has ben the game of the political leadership for the last 8 years (think Katrina, WMDs, the economy…). But in the end it was HE who was responsible for the great failure.He wants to take the money but not the responsibility. What kind of a leader is that?

Posted by jmmx | Report as abusive
 

Capitalism itself is not the problem here. Government is. As was quoted by Reagan, “Government is the problem not the solution.” Last year’s financial breakdown has a myriad of causes none of which can be attributed to capitalism in as much as the people who are involved. Government regulation should be there as a stop-gap measure against bad business practices. Yet I haven’t heard much, if any, criticism of the Congress/Senate and the subcommittees on finance, who’s responsibility is to oversea what had transpired. If these politicians can’t do their job as oversight, then maybe we should limit lobbyist in Washington so they may actually focus on their responsibilities as representatives and not serving lobbyist and PAC’s. I doubt they (Reps R’s&D’s) spend much time at all in subcommittee doing much else. And there lies the real root of the problem. Capitalism, Marxism or whatever Ism you choose, without competent leadership in our government neither will flourish.

Posted by David | Report as abusive
 

Villain. How much was Lehman leveraged – 35 to 1? Bring back the tumbrils.

Posted by SODDI | Report as abusive
 

Fuld,you failed. Do you understand that?

Posted by Rory Rogney | Report as abusive
 

Complete scapegoat—-the facts remain that our government, specifically, Hank Paulsen, chose NOT to bail out Lehman Brothers, unlike what they did for other firms and AIG. I would have thought they would understand the ramifications of letting this firm file for bankruptcy, but apparently they did not think it through far enough at the time—as the brass involved with that decision last year now say if they “had it do over again, we would not have let Lehman Brothers fail.”Knowing Richard Fuld since I was two years old—I am now fifty-seven years old, and still very close with the Fulds, I KNOW that Lehman Brothers ran through Richard’s blood—his entire career was devoted to that firm, and he made a ton of people wealthy, beyond their wildest dreams, in the process.The government made a HUGE mistake here, and they are blaming it all on Richard. But typical of the media and the top brass in DC a year ago—-build people up and then take delight in tearing them to shreds. Shame on all of you, Especially you, Mr. Paulsen.

Posted by Elizabeth Schaper | Report as abusive
 

Give me a break – why should anyone feel sorry for this creep. He was the big shot in the top office – you know he knew what was going on. Should we all feel sorry for him that he still owns several mansions while most people lost their entire life savings and jobs because of his actions and his cronies. He is a true gorilla. Greed is what got him where he is and he has some nerve sitting in fancy restaurants power lunching. He should be in hiding for the shameful things he’s done to him employees and investors.

Posted by Mo | Report as abusive
 

So one of the liars club was not telling the truth. AMAZING. — When is the FBI going to bust Goldman Sachs, freeze all of their flash-trading accounts, and seize the hot-box computers for forensic analysis?

 

Fuld was a company man – devoted to success – a true American patriot. That was his downfall when PAULSON, a.k.a. ‘Janitor from the bottom of the drum’ got pi$$ed because Goldman Sachs took the biggest hit due mainly to the successes of Fuld’s directives and efforts. Paulson got his buddies at Goldman Sachs the ‘deal of the century’ and left Lehman Bros. to rot in the sun. Nobody would buy out L.B. after Paulson worked the media wrecking ball to destroy any chances of bailing L.B. out of the financial mess. Paulson and his lover Barney Frank had to find a fall guy and Fuld was it. That is the ONLY way Paulson and Frank could steer the finger of blame away from the real culprits – themselves. Human behaviour is a predictable thing – follow the money. Goldman Sachs now gets a ‘commission’ payment for EVERY SINGLE CARBON CREDIT bought or sold …. hmmm, THANKS Henry Paulson and the Obummer administration cronies – you are all SCUM.

Posted by RightWingNut | Report as abusive
 

Since Reagan’s presidency conservatives have tried to sell Americans on the notion that democracy equals capitalism – an historically false idea??? You kidding right.Please C S – point us to when and where in mankinds societal history that capitalism and democracy together have failed. The failures I know of all have come when nationalism and socialism take over a capitalist society – did I miss some history chapters back in school? Did you like Michael Moores films?? Maybe Fidel and family will take you in – Cuba is nice I hear. We live in a Republic – according to James Madison and Benjamin Franklin – so long as we can keep it, it will allow us to flourish as a nation – worked nicely over the past 230 years – except when fools thinking like you wanted it to be changed and re-written because your elitist brains got in the way of common sense and respect for the founding fathers of our nation. Has the mindset of anti-American Obama followers made you forget?

Posted by RightWingNut | Report as abusive
 

His first name says it all.

Posted by Mufaso | Report as abusive
 

Dear RW Nut,The class of political ideas is not the same as the class of economic practice, therefore democracy does not equal capitalism. The attempt by Bush to deregulate in the spirit of Reagan – deregulate either by law or by neglect of law has led to economic disaster. Phil Gramm may disagree that the current economic situation is a disaster, but it seems he’s being pretty quiet about it.As for Fuld, it’s hilarious that the conversation asks whether Lehman should have been bailed out – then Fuld would have his job, employees and investors would be happy, and counterparties would be satisfied. Fuld, had he been a responsible manager wouldn’t have led Lehman to the point where they needed a bailout.

Posted by C S | Report as abusive
 

HEY GANG. Let’s wake up on the LEHMAN issue. AIG (which effectively saved GOLDMAN because of Goldman’s huge Credit Default swap counter party risk with AIG), Bear, FNMA, FREDDIE, CITI, Morgan, Goldman, WAMU, B of A and I could go on…all got saved by the Federal Government. Hank Paulson wanted Lehman out of the way so GOLDMAN and JP Morgan could control the markets and print money with less competition. There is no other way to look the events. Why did Hank prohibit the SHORTING OF FINANCIAL STOCKS the week after LEHMAN went down? Why did he wait and let Lehman flap in the wind for months while Lehman was under attack by the short sellers? Because his former firm, Goldman, that had made him beyond wealthy, was under attack the week after Lehman filed. Hank Paulson had cashed out on 500,000,000 in Goldman stock before he took the job in he Bush administration….and he did not pay capital gains on any of the stock sales! That created loyalty. FOLKS WE MUST LOOK AT THESE FACTS…Lehman was not any worse in terms of risk management than Goldman, or Morgan Stanley or JP Morgan or Citi. Hank just wanted LEHMAN out of the way! It could not be any more obvious if one looks at the events around the Lehman filing.

Posted by Joe Johnny | Report as abusive
 

HEY GANG. Let’s wake up on the LEHMAN issue. AIG (which effectively saved GOLDMAN because of Goldman’s huge Credit Default swap counter party risk with AIG), Bear, FNMA, FREDDIE, CITI, Morgan, Goldman, WAMU, B of A and I could go on…all got saved by the Federal Government. Hank Paulson wanted Lehman out of the way so GOLDMAN and JP Morgan could control the markets and print money with less competition. There is no other way to look the events. Why did Hank prohibit the SHORTING OF FINANCIAL STOCKS the week after LEHMAN went down? Why did he wait and let Lehman flap in the wind for months while Lehman was under attack by the short sellers? Because his former firm, Goldman, that had made him beyond wealthy, was under attack the week after Lehman filed. Hank Paulson had cashed out on 500,000,000 in Goldman stock before he took the job in he Bush administration….and he did not pay capital gains on any of the stock sales! That created loyalty. FOLKS WE MUST LOOK AT THESE FACTS…Lehman was not any worse in terms of risk management than Goldman, or Morgan Stanley or JP Morgan or Citi. Hank just wanted LEHMAN out of the way! It could not be any more obvious if one looks at the events around the Lehman filing.

Posted by Jim Lieberman | Report as abusive
 

Villain. He should be bankrupt and doing time, but instead he’s rich and the country’s in a financial crisis thanks to the actions of him and others like him.

Posted by strayling | Report as abusive
 

Lehman Brothers went bankrupt on 15 September 2008, because they lost a Credit Default Swap bet of over $1 billion on the conservatorship of Fannie Mae and Freddie Mac which occurred on 7 September 2008.

Posted by Peter L. Griffiths | Report as abusive
 

As I’ve written several times, this guy is simply a small fish in the big scheme of things. He made his millions, maybe more, and is getting on with his life just as virtually all CEOs do after they run their respective companies into the ground, take their giant bonuses, and retire to live happily ever after on a golf course. This, my friends, is exactly what the American taxpayers want for these people, or else they’d change it. Whining and complaining about it does nothing to change it.

Posted by Frank | Report as abusive
 

Could someone musically inclined rewrite the lyrics to the Who song: “We Won’t Get Fuld Again’?

Posted by TMC | Report as abusive
 

Neither villain nor scapegoat. He bet the bank, but there were many outside the firm who created the conditions for the Lehman meltdojosephtibman@live.comlehmanbook.bl ogspot.com

 

Why do Catholic Priest think they have the right to take Jesus out of the Picture? Do they know one day They will be held responsible for that?

Posted by theresa | Report as abusive
 

L. Marceau & Jim Lieberman both hit the nail on the head in their comments about Paulsen and how he handled the Lehman debacle—-bravo—-brilliant!!
Read their comments above, follow the money trail and you’ll understand why the government, Geithner, Paulsen & the rest of them, including Bush & Cheney did what they did —-they all ought to be in jail—-speaking of “greed is good” and the new Wall Street film coming out soon. Guess they believe it for themselves and let the rest of us swing in the wind. It’s all about power, greed and money for them. Wake up people and as L. Marceau and Jim Lieberman said, follow the money—it’s about the only thing that does not lie anymore.

Posted by acbas | Report as abusive
 

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