“Leslee Gelber has been at loose ends since losing her job. Ken Linton, center, was ousted before the firm collapsed, and he began shorting its stock. Tom Ollquist, right, sold packages of mortgages and other financial products for Lehman Brothers” – IHT
“Tom Ollquist remembers Sept. 9, 2008 — the day Lehman Brothers laid him off — as if it were yesterday. “You’re not going to believe it,” he told his wife. “I was shot.” Six days later, so was Lehman Brothers. Federal regulators let the foundering firm slip into bankruptcy, a collapse that touched off the most perilous week of the financial debacle, after years of freewheeling lending, trading and regulation produced outsize losses that devastated the banking system and brought the economy to its knees…”
“Some of those Lehman alumni who didn’t manage to hang on to Wall Street jobs are still angry, bitter and confused; many others, like Mr. Ollquist, have moved on in their lives. The luckiest, like Ken Linton, a former Lehman trader, made enough money during the boom years to avoid having to think about their next paychecks.
He spends his time flying jets. Others, unable to find banking jobs, are building new work lives.. And, of course, there are those like Leslee Gelber, who is out of work, professionally adrift, and fearful that Wall Street will bounce back without her….”
They simply obeyed and, therefore, felt they were blameless
“Yet few Lehman veterans, or their counterparts at other banks, blame themselves for the havoc their activities wrought. Instead, they point to the failures of regulators….Mr. McKinney left Lehman a month before the firm collapsed, to join a hedge fund. When asked whether he raised any red flags about problems in Lehman’s mortgage business, he declined to discuss that, or any other aspects of his work at the firm. But he noted that financial companies are responsible for adequately managing their own risks.
Those much further down the corporate ladder from Mr. McKinney, including about two dozen people interviewed for this story, say they don’t feel they deserve much blame for what happened at their firm. They were just following orders, they say”.
“It is very human and understandable to feel the pressure of the time and respond accordingly,” says Karen Brenner, a professor of business ethics and corporate governance at New York University. “These people were operating in a culture where this behavior was prized and rewarded. But I think it is too easy to say, ‘They made me do it; I don’t have to examine what I did.’ These people are professionals with duties and obligations to clients.”
“I spent a long time being very angry,” says Mr. Schaefer, the former Lehman executive turned gas station owner. “Angry for working so hard and doing so much. More importantly, for my family and all the time I was away traveling — the time I put in away from them. Now all that money I earned, the money paid in stock, is gone. I can’t go back and remake it.”
Even a senior vice president could not raise questions
“Mr. Linton evaluated mortgages that were later sliced and diced into securitized investments. In his 13 years working at the firm, Mr. Linton, 43, impressed many with his intelligence. A native of Northern Ireland, he had earned a doctorate in engineering and computer science before moving to the United States to create models for Wall Street. Lehman laid him off in early 2008
He recalls vividly the days in early 2007 at Lehman when his financial models began to throw up more warnings showing delinquencies and defaults, and he remembers colleagues on his desk raising questions about loan quality.
But he said the firm’s ranking as the top loan originator on Wall Street, not to mention the pressures put on the desk by Lehman’s growth-obsessed leadership, made it difficult for even the most senior executives to raise questions, even a senior vice president like Mr. Linton.
He says he has no qualms about his work at Lehman or its economic after-effects.”
“Anyone at our level who had a different view from senior management would find themselves going somewhere else quick,” he says.
Excerpts from International Herald Tribune