http://www.informationclearinghouse.info/article25284.htm
A sweet read on a very sour situation. William Blacks actual grilling can be found here.
http://www.house.gov/apps/list/hearing/financialsvcs_dem/black_4.20.10.pdf
April 21, 2010 "Information Clearing House" -- On Tuesday, Former regulator William Black appeared before the House Committee on Financial Services and beat the living-tar out of Lehman CEO Dick Fuld for 8 full minutes. It was a moment of sheer, unalloyed pleasure that will be savored for a long time to come.
"Lehman’s failure is a story in large part of fraud," Black roared. "Lehman was the leading purveyor of liars’ loans in the world. For most of this decade, studies of liars’ loans show incidence of fraud of 90%. ... If you want to know why we have a global crisis, in large part it is before you."
When the camera shifted to Fuld, he looked confused. "Why is this bearded man saying these terrible things about me. I am a Wall Street banker," he mused. "Don't they know that I create jobs and allocate capital to enterprising entrepreneurs?"
Black again: "Let’s start with the repos. We have known since the Enron in 2001 that this is a common scam, in which every major bank that was approached by Enron agreed to help them deceive creditors and investors by doing these kind of transactions.....And so what happened? There was a proposal in 2004 to stop it. And the regulatory heads...killed it."
By now, Fuld was fidgeting in his chair; tugging at his collar and looking over his shoulder to see if the exits were still where he remembered them to be. "Repos, repos, repos," he thought angrily. "All these people think about is repos. We provided a service; liquidity for the markets, capital for new businesses. We make the system work. That's enough, isn't it? Who is this irritating fellow? I haven't seen him at the club, have I?" Fuld wondered if Black wore sandals and belonged to a food co-op.
Black again: "We have known for decades that these are frauds. We have known for a decade how to stop them. All of the major regulatory agencies were complicit in that statement, in destroying it. We have a self-fulfilling policy of regulatory failure because of the leadership in this era.
