Lehman's Golden Parachutes Were Being Secured While Execs Were Pleading For Federal Rescue

Lehman Executive Defends Compensation Of $350 MillionLehman Secured Golden Parachutes While Pleading For Federal Rescue

WASHINGTON — The now-bankrupt investment bank Lehman Brothers arranged millions in bonuses for fired executives as it pleaded for a federal lifeline, lawmakers learned Monday, as Congress began investigating what went so wrong on Wall Street to prompt a $700 billion government bailout.
The first in a series of congressional hearings on the roots of the financial meltdown yielded few major revelations about Lehman's collapse, and none about why government officials, as they scrambled to avert economic catastrophe, declined to rescue the flagging company while injecting tens of billions of dollars into others.
But it allowed lawmakers still smarting from a politically painful vote Friday for the largest federal market rescue in history to put a face on their outrage at corporate chieftains who took home hundreds of millions of dollars while betting on risky mortgage-backed investments that ultimately brought the financial system to its knees.
That face was Richard S. Fuld Jr., the Lehman chief executive who sat for a two-hour-plus grilling before the House Oversight and Government Reform Committee as the panel combed through his pay history, management practices and financial strategies.
"You made all this money by taking risks with other people's money," Rep. Henry Waxman, D-Calif., the panel's chairman, said. "The system worked for you, but it didn't seem to work for the rest of the country and the taxpayers, who now have to pay $700 billion to bail out our economy."

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