Ward - The Devils Casino: Friendship, Betrayal and the High Stakes Games Played Inside Lehman Brothers

Table of ContentsTitle PageCopyright PageDedicationEpigraphCast of Characters Key Players Lehman 1984 -1994, the Slamex Years Lehman 1994-2008: From Independence to Meltdown Key Lehman Spouses The Original Lehman Brothers Industry Players Barclays The Law Bankruptcy Administrators Government Players Prologue Part One - THE PONDEROSA BOYS Chapter 1 - A Long, Hot Summer Chapter 2 - The Beginning Chapter 3 - The Captain Chapter 4 - The "Take-Under" Chapter 5 - Slamex Chapter 6 - The Phoenix Rises Chapter 7 - Independence Day Chapter 8 - The Stiletto Chapter 9 - The Ides of March Chapter 10 - Eulogies Part Two - THE ECHO CHAMBER Chapter 11 - Russian Winter Chapter 12 - Lehman's Desperate Housewives Chapter 13 - The Young Lions Chapter 14 - 9/11 Chapter 15 - No Ordinary Joe Chapter 16 - The Talking Head Chapter 17 - The Sacrificial Ram Chapter 18 - Korea's Rising Sum Chapter 19 - The Wart on the End of Lehman's Nose Chapter 20 - Damned Flood? Chapter 21 - Closing the Books EpilogueA Note About the SourcesNotesReferencesAcknowledgementsIndex Copyright (c) 2010 by Vicky Ward. All rights reserved. Published by John Wiley & Sons, Inc., Hoboken, New Jersey. Published simultaneously in Canada. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 646-8600, or on the Web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008, or online at http://www.wiley.com/go/permissions.

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Wiley also publishes its books in a variety of electronic formats. Some content that appears in print may not be available in electronic books. For more information about Wiley products, visit our web site at www.wiley.com. Library of Congress Cataloging-in-Publication Data: Ward, Vicky. The devil's casino : friendship, betrayal, and the high-stakes games played inside Lehman Brothers / Vicky Ward. cm. cm.

Includes bibliographical references and index. eISBN : 978-0-470-63823-1 1. Lehman Brothers. 2. Investment banking--New York (State)--New York--History. 3.

Investment advisors--New York (State)--New York--History. 4. Finance--New York (State)--New York--History. I. Title. Paradise Lost by John Milton, 1:254-255Cast of CharactersKey PlayersRichard S. "Dick" Fuld Jr. , Lehman's chief executive officer. "Dick" Fuld Jr. , Lehman's chief executive officer.

An underachiever in youth, Fuld got a job trading commercial paper at Lehman in 1969. Joseph M. "Joe" Gregory, president and chief operating officer. Gregory started at Lehman in 1968 as a summer intern when he was 16 years old. He used to cut the lawn of Lehman's top trader, Lew Glucksman. T.

Christopher "Chris" Pettit, Lehman president and chief operating officer. A West Point graduate, decorated Vietnam veteran. He joined the firm in 1977 and rose through its ranks--until, that is, 1997. Lehman 1984 -1994, the Slamex YearsBoard Members of Either Amex or Shearson Noted in the Book David Culver John Byrne President Gerald Ford Richard Furlaud Henry Kissinger Dina Merrill (actress) CEOs Howard L. "H" Clark Peter A. "Lew" Glucksman Harvey S. Golub J. Golub J.

Tomlinson "Tom" Hill James D. Robinson Sanford I. "Sandy" Weill Managing Directors James S. Boshart III Herbert Freiman Ronald A. Gallatin Jeffrey Lane Robert "Bob" Millard The Hon. Peregrine Moncreiffe Theodore "Teddy" Roosevelt V Peter J.

Solomon Executives Jim Carbone, senior deputy to Chris Pettit Steve Carlson, head of emerging markets John F. Cecil, chief financial officer (later also chief administrative officer) Steven "Steve" Carlson, global emerging markets John Coghlan, managing director of fixed income Leo Corbett, deputy head of equities Martha Dillman, sales Robert A. "Bob" Genirs, Shapiro's successor as CAO Nancy Hament, human resources Allan Kaplan, banking Bruce Lakefield Stephen "Stevie" Lessing, senior deputy to Tom Tucker Robert Matza, Stewart's successor as CFO Paul Newmark, senior vice president and treasurer, Lehman Commercial Paper Inc. (LCPI) Michael Odrich, chief of staff to Dick Fuld Marianne Rasmussen, head of human resources Thomas Russo, chief legal officer until 2008 Mel Shaftel, chief of investment banking Robert A. "Bob" Shapiro, chief administrative officer Richard B. "Tom" Tucker, sales Jeff Vanderbeek, rose to run all of fixed income, then capital markets James "Jim" Vinci, Pettit's chief of staff Paul Williams, equities chief Lehman 1994-2008: From Independence to MeltdownExecutives Madeleine Antoncic, head of risk Steve Berger, briefly co-head of banking Steven Berkenfeld, global head of legal, compliance, audit Jasjit "Jesse" Bhattal, replaced Tyree as head of Asia in 2000 Tracy Binkley, head of human resources Erin Callan, chief financial officer Steve Carlson, head of emerging markets Jerry Donnini, head of equities Eric Felder, replaced Reider Scott J. "Tom" Tucker, sales Jeff Vanderbeek, rose to run all of fixed income, then capital markets James "Jim" Vinci, Pettit's chief of staff Paul Williams, equities chief Lehman 1994-2008: From Independence to MeltdownExecutives Madeleine Antoncic, head of risk Steve Berger, briefly co-head of banking Steven Berkenfeld, global head of legal, compliance, audit Jasjit "Jesse" Bhattal, replaced Tyree as head of Asia in 2000 Tracy Binkley, head of human resources Erin Callan, chief financial officer Steve Carlson, head of emerging markets Jerry Donnini, head of equities Eric Felder, replaced Reider Scott J.

Freidheim, office of chairman, later chief administrative officer Mike Gelband, McDade's successor at fixed income David Goldfarb, chief financial officer turned chief administrative officer turned global head of strategic partnerships Hope Greenfield, chief talent officer Jeremy Isaacs, head CEO of Lehman Europe from 2000 onward Bradley Jack, banking, then co-COO Ted Janulis, head of mortgages Todd Jorn, hedge funds Alex Kirk, high-yield business Fran Kittredge, philanthropy Bruce Lakefield, Europe until 1999 Ian Lowitt, treasurer, later co-chief administrative officer, then chief financial officer Herbert "Bart" McDade, fixed income and later equities Hugh "Skip" McGee, investment banking Michael McKeever, briefly co-head of banking Christian Meissner, Europe Maureen Miskovic, risk Andrew Morton, Nagioff's successor in fixed income Roger Nagioff, European equity derivatives, then Gelband's successor in fixed income Chris O'Meara, CFO, then head of risk Rick Rieder, head of credit Thomas A. Russo, chief legal counsel Benoit Savoret, Europe Robert "Rob" Shafir, global equities David Steinmetz, Chris Pettit's chief of staff Paolo Tonucci, treasurer C. Daniel Tyree, Asia until 2000 Jeffrey Vanderbeek, head of fixed income turned vice president George Herbert Walker IV, investment management Mark Walsh, real estate Ming Xu, analyst