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The Highest Paid Man on Wall Street
The frustration over the proceeds from the Barclays deal among the Lehman creditors is such that Bryan Marsal, the turnaround expert who is now the CEO of Lehman Brothers Holdings—the bankrupt entity—is said to be considering bringing a lawsuit to recover, if possible, some additional value from Barclays based in part upon this potential conflict of interest. Marsal and the Lehman creditors are also working together to file a motion with the bankruptcy court—as soon as at the next public hearing on January 14—that would ask Judge Peck to appoint an examiner to investigate the Barclays deal for Lehman’s U.S. investment banking assets. “There clearly were conflicts of interest here,” said someone close to the Lehman estate.
For its part, Barclays can, of course, pay its executives whatever it wants to pay them. Barclays received no bailout money from the UK government (or, of course, from the U.S. government) and as a result has not been the focus of the efforts by Congressman Henry Waxman and New York State Attorney General Andrew Cuomo to reign in the huge bonuses that have historically been paid to Wall Street’s bankers, traders, and executives.
But something just does not feel right about the deal McGee cut for himself when the world was falling apart last September.
William D. Cohan, a former senior-level M&A banker on Wall Street, is the author of The Last Tycoons: The Secret History of Lazard Freres & Co. Cohan's House of Cards: A Tale of Hubris and Wretched Excess on Wall Street, will be published by Doubleday in 2009. He also writes for Fortune, ArtNews, The Financial Times, and The Washington Post.
John Talks Joe
Lloyd Grove is editor at large for The Daily Beast. He is also a frequent contributor to New York magazine and was a contributing editor for Condé Nast Portfolio. He wrote a gossip column for the New York Daily News from 2003 to 2006. Prior to that, he wrote the Reliable Source column for the Washington Post, where he spent 23 years covering politics, the media, and other subjects.
The Man Who Schooled Wall Street
William D. Cohan, a former senior-level M&A banker on Wall Street, is the author of The Last Tycoons: The Secret History of Lazard Freres & Co, and his new best seller House of Cards: A Tale of Hubris and Wretched Excess on Wall Street.
The Unnecessary Meltdown
William D. Cohan, a former senior-level M&A banker on Wall Street, is the author of The Last Tycoons: The Secret History of Lazard Freres & Co, and his new best seller House of Cards: A Tale of Hubris and Wretched Excess on Wall Street.
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William D. Cohan, a former senior-level M&A banker on Wall Street, is the author of The Last Tycoons: The Secret History of Lazard Freres & Co, and his new best seller House of Cards: A Tale of Hubris and Wretched Excess on Wall Street.
Interesting. I agree, the issue is not how much Barclays agreed to pay him per se but the conflict of interest in his negotiating a clearly out-of-market scale deal (relative to the timing) for himself personally precisely when he had a fiduciary responsibility to Lehman Bros employees, shareholders and creditors to get the best possible deal for all of them. The fact that the deal Barclays got was outrageously favorable to them makes his deal, as someone directly responsible for the negotiations, look and smell bad. The best justice is he'll be drowned in civil lawsuits and his $50M will go to "stimulating" the legal community for a while, unless of course he anticipated this and negotiated that Barclay's would be responsible for all his defense fees (which is certainly possible), in which case he gets the last laugh...
Do the hyper-wealthy just not get it? Do they not know how relatively few their numbers are? Do they not know how easy it is for a 12 year-old with an iPhone to find out everything about them and their families? Has a sense of invulnerability so engulfed their class that they don't see the potential for disaster they are fueling? A little humility and a lot of charity would go a long way to restoring a degree of respect that has been squandered.
In 1788 the French nobility felt invulnerable, saw no clouds on their horizon. Things changed.
Why is it that Wall Street seems incapable of grasping the fact that if 2008 proved anything it was that the public is fed up with the status quo? Not just for a couple of months but for good. The middle class was raised on the concept of a Meritocracy and yet in example after example financial reward seemed reserved for the professional class rather than those that show integrity in addition to successful results. Are we doomed to a class war and the unwinding of Capitalism? Wake up and smell the fair market coffee. Wall Street success was built on the assets of America's working class. If you want to see it reinvested make some attempt to tame the greed and create the necessary trust.
Thank you.
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