... Lehman used what amounted to financial engineering to temporarily shuffle $50 billion of troubled assets off its books in the months before its collapse in September 2008 to conceal its dependence on leverage, or borrowed money.This is also interesting:
Apparently unknown to Fuld, someone at Lehman had drafted a letter to employees "outlining a $3.5 billion investment from Buffett in Lehman's preferred stock at $54 per share conversion price."
That turned out to be a surprise for Buffett, "because he never got close to a deal with Lehman."
Based on a September 22, 2009 interview with Buffett, the report says, "Two items immediately concerned Buffett during his (March 28) conversation with Fuld."
First, "Buffett took it as a negative that Fuld suggested that Lehman executives were not willing to participate in a significant way" by investing in the firm under the same term.
Second, Buffett thought Fuld's complaints about short sellers indicated a "failure to admit one's own problems."
UPDATE: Yves Smith has a lot more, and it seems like Timothy Geithner is implicated.
UPDATE: Felix Salmon wonders if Arthur Andersen's fate awaits Ernst and Young.
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