Shaky Lehman Brothers has deep ties to Florida (Jeb Bush refusing to comment)

[seafan]

Shaky Lehman Brothers has deep ties to Florida

By Sydney P. Freedberg, Times Staff Writer
September 11, 2008

Troubled U.S. investment bank Lehman Brothers fought to survive Wednesday in a Wall Street crisis that could also rock the Florida agency that manages billions of dollars for the state and local governments.
The bank, which lost nearly half its value in the stock market on Tuesday, announced Wednesday that it would spin off real estate holdings and sell a majority of its investment management division.

.....

In fact, Lehman Brothers is a huge player in Florida government finance:

•The SBA has hundreds of millions in potential losses from mortgage-related securities it bought last year from companies that used the bank as a broker.

•Through the SBA, state and local government are heavily invested in Lehman's own securities.

•Lehman manages the assets in two SBA funds.

Lehman Brothers, the fourth largest U.S. investment bank, has been scrambling for a financial lifeline for weeks. It got into trouble by buying and financing real estate, including subprime mortgages.

.....

In Florida, Lehman Brothers was one of several brokers that sold the SBA billions in shaky, mortgage-related securities that ran into trouble last year and were eventually downgraded by rating agencies. In November, it sparked a run in which some local government agencies withdrew billions from the SBA's local government fund. The turmoil left some local agencies struggling to pay salaries and bills and led to the resignation of the SBA's executive director.
Gov. Charlie Crist and Chief Financial Officer Alex Sink, who serve on the SBA's three-member board of trustees, have said they suspect Lehman dumped tainted securities on the state.

The SBA also has bought billions of dollars worth of Lehman's own securities in recent months. Many have matured, but SBA records suggest that several are still outstanding.

.....

Lehman has a number of other ties to Florida. It earns lucrative fees underwriting bond deals for an assortment of state agencies. Last year, Lehman tried to sell Gov. Crist on a plan to sell off Florida's lottery. Nothing came of it.

Oh, yes, there's no doubt Jeb Bush was involved with this lottery privatization scheme:


Lehman /JP Morgan pushing to privatize FLA Lottery; Jeb Bush in as new Lehman financial advisor, September 11, 2007



More from the St. Pete Times article today:

Citizens Property Insurance Co., a state-run insurer of homes and condos, said Wednesday that it holds more than $35-million in Lehman securities.

The investment bank also has a big Florida name on its payroll.
In June 2007, the firm hired former Gov. Jeb Bush — five months after he left office and the SBA board of trustees — to serve as a consultant and member of its private equity advisory board, which buys and sells companies worldwide.

Bush has declined to elaborate on his work for the firm but has said he played no role in the sale of securities that were later downgraded.

On Wednesday, he did not respond to an e-mail requesting comments. Lehman Brothers has refused to comment on Bush's duties or compensation.

Forbes: Jeb Bush involvement with Lehman raises questions in Florida investment fund debacle, December 1, 2007


Gov Crist asks whether Lehman may have hired Jeb Bush to gain influence to sell bad debt to Florida, May 31, 2008





When will Jeb Bush undergo deposition for his role in this debacle? Like his pals Orlando Bosch and Luis Posada Carriles, Jeb Bush still walks free on the streets of Miami.

[Joanne98]

1. Where ever there's a bush, there's a banking crisis.

THREE GENERATIONS NOW! You would think stupid ass America would figure that out.

[formercia]

3. Don't forget insurance fraud.

One of JEB's pastimes.

[The Backlash Cometh]

2. Sounds like there aren't enough suckers born every day to keep these

investment firms buoyant.

[formercia]

4. Greed gets them all in the end.

I hope JEB gets nailed this time.

[The Backlash Cometh]

5. Of course, I should look at my portfolio to see if I have the authority

to raise the level of my righteous indignation.