When we last checked in with Erin Callan, post-Lehman life was going pretty well for the retired CFO. It included living in East Hampton in the house she bought for $3.9 million in 2005, dating firefighter Anthony Montella, who she met in high school at St. Francis Prep, taking spin classes at Ride the Zone, where her instructor said she’s “the best student in the class” and just generally looking happy and “better than ever,” likely a result of 1) getting laid on the reg and 2) the fact that she’s been working on her ass, an effort that has apparently not gone unappreciated. While it’s been forever since we heard from Dick Fuld’s former gal-pal, she apparently had a pretty good excuse for not keeping in touch– girlfriend was busy planning her wedding! The nuptials took place in November at 620 Loft and Garden at Rockefeller Center and included white calla lilies and Callan’s dogs. Left off the guest list? Not a problem- Dealbook has “reviewed” photos posted online by the event’s photographers and will make you feel like you were right there. Continue reading »
Erin Callan
Remember when Lehman went bankrupt? Good times. The thing about that was that pretty much right up until the minute Lehman filed, people like Dick Fuld and Erin Callan were going around saying things like “we stand extremely well capitalized to take advantage of these new opportunities” and “[w]e have maintained our strong liquidity and capital profiles even in this difficult environment.”
Knowing what happened next, some people thought that was kind of fucked up of them. And so a team of spoilsports including among other luminaries the Northern Ireland Local Government Officers’ Superannuation Committee sued Fuld, Callan, Joe Gregory, and a bunch of enablers like Ernst & Young (Lehman’s auditors) and UBS (who underwrote a lot of Lehman structured note offerings).
Today a federal court ruled on a motion to dismiss. It’s mostly bad news for Fuld, Callan & co., as the court let the lawsuit proceed on most of the important claims, including claims that Lehman misrepresented its net leverage using “Repo 105” transactions, lied about its “strong risk management culture with regard to the setting of risk limits” by repeatedly exceeding those limits, and misrepresented its credit-risk concentration in real estate.
But some bits of the ruling should make the ex-Lehman crowd happy: Continue reading »
Securities And Exchange Commission Can’t Find Any Grounds On Which To Sue Former Lehman Brothers Execs, May Release A Strongly Worded Letter Of Disappointment Instead
By Bess Levin
Remember Lehman Brothers? Bank that went under in 2008? Had some maybe questionable business going on with its balance sheet? The SEC has been trying its darndest for a while now to prove the company and its senior staff, led by a guy named Dick, violated securities laws but in over two years have come up with nothing and are pretty tuckered out. The Commission knows some people will be pretty ticked off if no lawsuits are ever brought against Richard Fuld and his backup dancers, which is why they’ve come up with an alternative that they think is nearly as good. No civil actions but instead- tell them what you think of this- Lehman Brothers is publicly rebuked? That’ll send a message, eh? Continue reading »
If you’re going to commit financial fraud, you probably don’t want to find yourself sitting at a table across from David Einhorn, who will know what you’re up to and share it with the world. Similarly, if you’ve never played poker and have only ever had a 15 minute tutorial on the game, you probably should avoid playing with the Greenlight Capital founder, whose vastly superior skills will demonstrate just how much you suck. As I like to live on the edge, yesterday in an undisclosed location, I choose not to heed the wisdom of the latter. Over several hands, Einhorn and I discussed the new edition of his 2008 book, “Fooling Some Of The People, All Of The Time.”
The latest version includes an epilogue, and concludes the story of Allied and Einhorn’s years of trying to get other people to listen when he said something was up. As we now know, Allied’s shares collapsed, Greenlight collected $35 million, and the hedge fund made another big (and correct) call on a bank called Lehman Brothers, whose failure was, according to Einhorn, “the Allied story all over again,” just on a bigger scale, with more resounding consequences. Even after the last crisis, which should have been a wake-up call, Einhorn doesn’t think we’ve changed much and if anything, the reforms passed only “encourage poor behavior and will likely foster an even bigger crisis.” He and I chatted about that exciting event, Quantitative Easing, Steve Eisman’s illicit pleasure of choice and more, plus poker tips for people who really, really need them.**
BL: You mentioned an unexpected and tremendous response from readers of the book the first time around. What’s the craziest piece of fan mail you’ve gotten- has anyone sent you their undergarments in the mail?
DE: [laughs] No, do you think they should?
BL: Sure.
DE: You’re hysterical.
BL: I mean, people do that. Musicians, rock stars get sent that sort of stuff. You’re like a rock star…of investing.
DE: Well, the thing is, my following [for the most part] is with 20 to 35 year old men. So, you know. I definitely don’t want their undergarments. Continue reading »
In addition to the whole “help turn Morgan Stanley around” task, Ruth Porat, who was named CFO last January, has another entry on her to do list: don’t get unceremoniously canned like your girlfriends. “Be careful in everything you do, because we all know how this ended before,” an analyst told her at a cocktail party earlier this year, the insinuation being that she ought to avoid getting fired from Lehman Brothers, forced to take a leave of absence from Credit Suisse, and ultimately spend her days taking spin classes and dating a firefighter in the Hamptons, like Erin Callan, or getting the bootskie from Vikram Pandit, like Sallie Krawcheck.
Porat may have gone from a client-facing banker job to a “technical” one where you have to, as Glen Schorr puts it, “know everything about everything,” without ever working in a finance department but forget about “numbers” for a second. This lady doesn’t have any quit in her, and has shown that crippling back pain or even labor contractions are mere speed bumps that will not in any way hamper her from doing what she has set out to do, unlike her male counterparts who would be crying for a heating pad at the first spasm or an epidural the second their water broke. Continue reading »
It’s not just chinos and pieces on the side. Another thing that made the Gorilla table flippingly mad was uppity pipsqueaks who dared to mention concerns about the firm committing fraud. Via the WSJ, here’s the letter that got whistle-blower Matthew Lee fired. He won’t make that mistake again!
MATTHEW LEE
May 18, 2008
PERSONAL AND CONFIDENTIAL
BY HAND
Mr. Martin Kelly, Controller
Mr. Gerard Reilly, Head of Capital Markets Product Control
Ms. Erin Callan, Chief Financial Officer
Mr. Christopher O’Meara, Chief Risk Officer
Lehman Brothers Holdings, Inc. and subsidiaries
745 7th Avenue
New York, N.Y. 10019
Gentlemen and Madam:
I have been employed by Lehman Brothers Holdings, Inc. and subsidiaries (the “Firm”) since May 1994, currently in the position of Senior Vice President in charge of the Firm’s consolidated and unconsolidated balance sheets of over one thousand legal entities worldwide. During my tenure with the Firm I have been a loyal and dedicated employee and always have acted in the Firm’s best interests.
I have become aware of certain conduct and practices, however, that I feel compelled to bring to your attention, as required by the Firm’s Code of Ethics, as Amended February 17, 2004 (the “Code”) and which requires me, as a Firm employee, to bring to the attention of management conduct and actions on the part of the Firm that I consider to possibly constitute unethical or unlawful conduct. I therefore bring the following to your attention, as required by the Code, “to help maintain a culture of honesty and accountability”. (Code, first paragraph).
Under the Chapter 11 reorganization plan proposed by the company, Lehman sought authority to create an asset manager business called LAMCO that would specialize in management of Lehman’s commercial real estate, mortgages, principal investments, private equity, corporate debt and derivatives assets.
Lehman said LAMCO would provide management services to Lehman, administer its assets and offer long-term employment opportunities for the hundreds of Lehman employees working to liquidate the former investment bank’s estate.
Lehman plans to end bankruptcy, create new company [Reuters]
How Would Former Lehman Brother’s CFO Brad Hintz Characterize The Bank’s Accounting Practices?
By Bess Levin
“Shenanigans, Bob. Shenanigans.”
Earlier today we brought you up to speed on Erin Callan’s life post-Lehman Brothers, which, as it turns out, is pretty sweet, as is her ass. She’s living in her $3.5 million home in the Hamptons, friends report she’s looking “better than ever,” she’s the best student in her spinning class, and she’s in love with a firefighter she’s known since high school. And not some shlub she’d be embarrassed to be seen in public with but maybe the seriously hot piece of A seen at left, who has the same name as the guy identified by Fortune as EC’s man (Anthony Montella). Continue reading »
Oh, hi. I didn't see you there.
A few weeks ago, it was reported that Erin Callan had officially retired from Wall Street, which was something of a formality, as she’d left her post-Lehman gig at Credit Suisse over a year ago, and we’d heard nary a peep from her since. What was she up to? We had no idea! Was she ensconced in her Upper East side pad, watching trashy daytime TV? Was she out in Greenwich, keying Dick Fuld’s Benz? Was she stepping out of black cars, momentarily pausing for a camera that was no longer there? Had she let herself go? No one knew. Until now. Fortune did a little investigative reporting and it turns out things are going pretty swimmingly for EC. Before we get into what’s been a’ poppin’ for the former Lehman CFO, though, let’s take two to go back. Way back.
Even as a child, Callan was not only talented but also disciplined and self-motivated. Midge Stack-Lennon, who was Callan’s high school gymnastics coach, remembers her as “this adorable, teeny little thing with the strength of a man.” Football players used to troop into the gym to watch Erin practice, and she was happy to perform for them. “She would get up on the bars with hands that were ripped and go through her routine,” Stack-Lennon says. “Her hands would be bleeding. She would think nothing of it.”
So, just file that image away for now while we talk life, post-Dick. First off, Erin’s been living in East Hampton, at the house she bought for $3.9 million in 2005. She’s been seeing firefighter Anthony Montella, who she met in high school at St. Francis Prep. People say the two “seem to be in love,” and that Callan “looks better than ever,” likely a product of 1) getting laid on the reg and 2) the fact that she’s been working on her ass, an effort that has not gone unappreciated, according to those who’ve been staring at it.
Erin Callan took a leave of absence from her job at Credit Suisse over a year ago. Since then, we’d heard nary a peep from the old girl. In our minds we knew she’d likely extended her vacation to something more permanent, but in our hearts we hoped against hope to wake up one morning and see her going at it with David Einhorn on Squawk Box, or posing in front of black cars in the Wall Street Journal. Today Charlie “I’m gonna nut in Maria Bartiromo et al’s eyes” Gasparino has crushed that dream. The ace reporter, working the phones all morning, delivers this devastating blow sure to rock your world: “Callan has formally ‘retired’ from the securities business, according to people with knowledge of the matter.” The situation is not fluid.
