This story appeared in Bank Digest
Rep. Spencer Bachus, R-Ala., has sent a letter to Financial Services Committee Chairman Barney Frank, D-Mass., calling for an investigatory hearing to be held on the bankruptcy of Lehman Brothers, whose collapse contributed to the financial crisis in the fall of 2008. As Ranking Member on the Committee, Bachus called for the hearing on new revelations detailing potential accounting fraud at the investment bank and lax oversight by federal regulators. Bachus said the report from Lehman Brothers' court-appointed bankruptcy examiner shows a failure of government regulators, including the Federal Reserve Board and the Securities and Exchange Commission, to act on evidence of accounting gimmicks used to hide the company's debt and mask its insolvency. “This report casts additional doubts on the ability of the Federal Reserve to effectively perform the expanded supervisory responsibilities called for in House and Senate regulatory reform bills,” Bachus said.