NJ sues Lehman, Ernst for lost pension millions
New Jersey blew millions in taxpayer-backed pension funds on risky investments in Lehman Bros. near its end. Someone should pay. Why not the defunct investment bank's insurers, says Gov. Corzine.
Philadelphia-based Berger & Montague, lawyers, are helping New Jersey try to collect some fo the money it lost when Lehman Bros. blew up. But Lehman's bankrupt! No matter; they were insured, so were their accountants, and their board...
"The state of New Jersey has filed suit against top executives and members of the board of directors of bankrupt Lehman Brothers Holdings Inc., charging that misrepresentations by the company led the Division of Investment in the Department of Treasury to purchase $182 million in Lehman securities in April and June 2008 that resulted in an estimated $118 million in losses, Governor Jon S. Corzine announced today. The state also sued Lehman's long-time accountants Ernst & Young."
NJ says its investments in Lehman "were based on financial statements and materials that contained material misstatements and omissions regarding the value of Lehman’s assets that the Division of Investment could not have known were false... Executives from Lehman had disavowed to representatives of the Division of Investment the company’s exposure to the collapsing real estate market and had claimed that Lehman had sufficient liquidity, a strong capital base and superior hedging, risk management and valuation... Lehman executives knew, or should have known, that Lehman’s overvalued residential and commercial real estate portfolio was making it increasingly illiquid.























