Lehman Investigation Said to Be Closing In

September 10, 2010, 5:58 am

In the Securities and Exchange Commission’s investigation into the fall of Lehman Brothers, scrutiny has turned to an accounting maneuver that artificially lowered the bank’s debt levels, The Wall Street Journal reported.

The investigation is also looking into the accuracy and consistency with which executives noted the cost of the real-estate portfolio acquired when Lehman took over the apartment developer Archstone-Smith Trust, and the extent to which investors were made aware of the losses that resulted, The Journal said.
As the investigation gets more specific, so the threat of the S.E.C.’s bringing civil charges pertaining to the investment bank’s collapse increases. However, The Journal noted, it doesn’t look like a decision is going to be made just yet.

“Bottom line, the S.E.C. wants a scalp out of Lehman,” Lawrence G. McDonald, a former vice president at the bank, told DealBook. “So does the White House.”