Lehman Brothers Hedge Funds Collapse

Lehman Brothers Lawyers Investigating Hedge Funds

Lehman Brothers' former CEO Dick Fuld testifies to the Financial Crisis Inquiry Commission today, to explain how the massive investment bank failed. One possible explanation that Lehman Bros. is looking into is that hedge funds accelerated the collapse in 2008. The Times wrote compared the theory to the conspiracy in the JFK assassination, "It is the Wall Street version of the grassy knoll." A team of lawyers hired by the estate of Lehman Brothers Holdings has requested the trading records for 2008 from Goldman Sachs and several hedge funds including SAC Capital Advisors, Citadel Investment Group and Greenlight Capital.

Nearly two years after the collapse of Lehman Brothers, some on Wall Street still wonder whether a handful of the nation’s most powerful hedge funds conspired to push the 158-year-old financial giant into bankruptcy while making big profits for themselves.

Now, in search of a smoking gun, a law firm hired by the estate of Lehman Brothers Holdings has demanded trading records, e-mail and other correspondence for all of 2008 from a collection of prominent hedge funds and the venerable Goldman Sachs.

The firms named in the inquiry make up a Who’s Who of the hedge fund world, and include SAC Capital Advisors, run by Steven A. Cohen; Greenlight Capital, managed by David Einhorn; the Citadel Investment Group, led by Kenneth C. Griffin; and Och-Ziff Capital Management, whose chief executive is Daniel Och. Source

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