Two years after he ran Lehman Brothers into the ground, Dick Fuld is about to get another chance to explain himself.
Fuld, who led Lehman for 15 years until it collapsed in September 2008, will appear Wednesday before the Financial Crisis Inquiry Commission, the congressionally appointed panel that’s writing the definitive account of the financial meltdown.
Fuld and six others have been called to appear before the FCIC Wednesday, to discuss the September 2008 collapses of Lehman and Wachovia, the North Carolina bank that was sold in extremis to Wells Fargo. Wednesday’s other headliner is Robert Steel, the former Goldman Sachs banker and Treasury official who was running Wachovia when it nearly plunged into the abyss.
On Thursday, Fed chief Ben Bernanke and Federal Deposit Insurance Corp. Chairman Sheila Bair will testify.
The FCIC, which must send Congress a report by mid-December, interviewed executives at the other big Wall Street failure, Bear Stearns, at a hearing in May. But because Lehman’s collapse led to a near economic collapse, Fuld’s testimony stands to be a bigger deal.
Fuld has been mostly out of the public eye since Lehman’s collapse, preparing to fight what is shaping up as a long spell defending himself in court. His utterances since the firm’s Sept. 15, 2008, bankruptcy have been met mostly with stunned disbelief.
He last appeared in public in April, when he told the House Financial Services Committee he had “absolutely no recollection whatsoever of hearing anything about or seeing documents related to Repo 105 transactions while I was the CEO of Lehman.”
Repo 105 was the program under which Lehman made its balance sheet look less leveraged, by treating some borrowing transactions as asset sales. The firm’s Repo 105 dealings reached as high as $50 billion a quarter in 2008, a bankruptcy examiner found — prompting some observers to ponder a possible Sarbanes-Oxley prosecution for Fuld.