This week’s 60 Minutes expose on the bankruptcy of Lehman Brothers was revolting in the portrayal of the senior executives at Lehman Bros., Ernst and Young, and the SEC. These people are despicable human beings, disgusting in the extent of their personal greed and disregard for morals, ethics and laws. I suppose I tarnish the SEC with too close a comparison with the first two, but they’re involved, too, up to their eyeballs.
What a bunch of liars, the whole lot. The sad part is that the American people let them get away with this kind of fraud, again and again and again. How many of you have written to your congressional representatives about the repeal of Glass-Steagall and the lack of effective government regulation of the financial sector? About your outrage at the greed and excess and fraud of Wall Street?
There is no end of talk and discussion of risk analysis, governance, risk management, oversight, regulation, ethics, compliance, blah blah blah, blah blah blah blah blah blah blah blah blah blah blah blah.
To me, it all sounds like window dressing and self abuse. We got it. We get it. We know how to do this. Let’s stop chasing our tails. What’s needed is consequences that matter for those who abuse the system and the public trust and the law, and protections for those who do the right thing, like Matthew Lee. What about SOX and the whistleblower protections? A lot of good that did old Matthew! Below is mostly taken directly from the 60 Minutes article. It’s well done. It makes me sick to my stomach. We should be able to do better than this. So much for the vaunted independence and professionalism of the CPA’s. People need to go to jail for this. Internal and external auditors need to stop talking amongst ourselves and we need to start talking with our congressional representatives about this. Unfortunately, that will probably get us nowhere, but I refuse to give up.
I’m fascinated that in over 2,000 hits on this blog, I have received only a hand full of comments, and those over a year ago. Would anyone like to comment and perhaps anonymously tell your story of trying to do the right thing and getting shot down? Or, better yet, of getting complete support from senior management for a serious ethical issue brought to light.
As described in another post or 2 on the blog, I have nothing but contempt for Congress. They’ve earned it. AND, it’s a non-partisan, independent contempt for the entire bunch of rotten tomatoes.
I apologize for the extensive quoting. However, I could not have said it better.
“When Lehman Brothers collapsed, 26,000 employees lost their jobs and millions of investors lost all or almost all of their money, triggering a chain reaction that produced the worst financial crisis and economic downturn in 70 years.”
“There was concerns being expressed by– at high levels about whether this is appropriate, what happens if the street found out about it. So, you know, there was a concern that there’s a real question about whether we can do this, whether this was right or not.
One of those people was Matthew Lee who had been a senior executive at Lehman and the accountant responsible for its global balance sheet. Lee was one of the first to raise objections inside Lehman about the accounting trick known as Repo 105.”
“A statement from Ernst and Young: Lehman’s bankruptcy occurred in the midst of a global financial crisis triggered by dramatic increases in mortgage defaults, associated losses in mortgage and real estate portfolios, and a severe tightening of liquidity.
We firmly believe that our work met all applicable professional standards, applying the rules that existed at the time. Lehman’s demise was caused by the global financial crisis that impacted the entire financial sector, not by accounting or financial reporting issues.”
“Ernst and Young, Lehman’s accounting firm is now being sued by New York State for aiding and abetting a fraud.
And Matthew Lee the senior account who blew the whistle at Lehman is still looking for work, unconvinced that much has changed in the world of finance over the last four years. “
cash skimming, CPA, embezzlement, Employee Theft, fraud, fraud theft embezzlement internal controls small buisiness, Internal Audit, internal controls, scam, Telephone auditing, theft