Lehman's $500 Million in Found Money
It must have been a little like when you find a wadded up $20 Bill in the pocket of last year's winter coat: Judge James Peck ordered the sum of $500 million to be returnedto the now bankrupt Lehman Brothers. Which party, exactly, was ordered to return a half billion dollars to Lehman? Bank of America.
The money had been provided by Lehman Brothers to Bank of America as collateral for Lehman checks in August of 2008.
Judge Peck said of the matter: "It is difficult to understand how BofA could have thought that taking the money was the right thing to do without first seeking permission from the court," which is not exactly a very sympathetic reading of Bank of America's failure to return the funds.
The judge then added, "The court believes that the actions taken were surprising and, quite frankly, disappointing for a leading financial institution that should care a great deal about its reputation."
Which, to me at least, has a touch of the sentiment contained in the "I'm very disappointed that a big boy like you doesn't know how to behave better by now" scoldings that I endured from my grandmother.
Childhood emotional trauma notwithstanding, the CNBC account goes on to add: "British bank Barclays bought Lehman's main U.S. brokerage business after the bankruptcy filing, and Lehman's other assets are being managed and unwound while operating under bankruptcy protection."
No mention has been made of whether individual creditors will seek to make specific claims against the cash returned by Bank of America —perhaps in the fashion of swarming relatives descending upon a long-estranged country cousin who has just won the lottery.
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