For $10, Fuld Sold Florida Mansion to His Wife

http://www.nytimes.com/2009/01/26/business...tml?_r=2&hp

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By LOUISE STORY

Published: January 25, 2009

Housing prices are falling around the country, but this one sounds hard to believe: A seaside mansion on Jupiter Island in Florida, bought for more than $13 million five years ago, was just sold for $10.

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Richard S. Fuld Jr., the former chairman and chief executive of Lehman Brothers, testifying at a Congressional hearing last October.

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Times Topics: Richard S. Fuld Jr. | Lehman Brothers Holdings Inc.

For $10, Fuld Sold Florida Mansion to His Wife

http://www.nytimes.com/2009/01/26/business...tml?_r=2&hp

Article Tools Sponsored By

By LOUISE STORY

Published: January 25, 2009

Housing prices are falling around the country, but this one sounds hard to believe: A seaside mansion on Jupiter Island in Florida, bought for more than $13 million five years ago, was just sold for $10.

Skip to next paragraph

Enlarge This Image

Karen Bleier/Agence France-Presse — Getty Images

Richard S. Fuld Jr., the former chairman and chief executive of Lehman Brothers, testifying at a Congressional hearing last October.

Related

Times Topics: Richard S. Fuld Jr. | Lehman Brothers Holdings Inc.

That story was on all the newswires over the weekend, sounds like the guy got caught trying to hide assets by transferring them to his wife. Doesn't seem like it has much to do with Thailand though.

For $10, Fuld Sold Florida Mansion to His Wife

http://www.nytimes.com/2009/01/26/business...tml?_r=2&hp

Article Tools Sponsored By

By LOUISE STORY

Published: January 25, 2009

Housing prices are falling around the country, but this one sounds hard to believe: A seaside mansion on Jupiter Island in Florida, bought for more than $13 million five years ago, was just sold for $10.

Skip to next paragraph

Enlarge This Image

Karen Bleier/Agence France-Presse — Getty Images

Richard S. Fuld Jr., the former chairman and chief executive of Lehman Brothers, testifying at a Congressional hearing last October.

Related

Times Topics: Richard S. Fuld Jr. | Lehman Brothers Holdings Inc.

That story was on all the newswires over the weekend, sounds like the guy got caught trying to hide assets by transferring them to his wife. Doesn't seem like it has much to do with Thailand though.

There are several Thai building projects affected by the outcome of all this. Lehman brothers was on the blame line for some of the biggies.

For $10, Fuld Sold Florida Mansion to His Wife

http://www.nytimes.com/2009/01/26/business...tml?_r=2&hp

Article Tools Sponsored By

By LOUISE STORY

Published: January 25, 2009

Housing prices are falling around the country, but this one sounds hard to believe: A seaside mansion on Jupiter Island in Florida, bought for more than $13 million five years ago, was just sold for $10.

Skip to next paragraph

Enlarge This Image

Karen Bleier/Agence France-Presse — Getty Images

Richard S. Fuld Jr., the former chairman and chief executive of Lehman Brothers, testifying at a Congressional hearing last October.

Related

Times Topics: Richard S. Fuld Jr. | Lehman Brothers Holdings Inc.

After his hearing, he was working out in the company gym, when one of his staff punched him out, cold.

Big Fing deal. It means nothing except that he is trying to delay the inevitable.

He's about to be sued. And even if the claims are defended successfully, litigants can attach liens to the property to try and pressure a settlement. Those liens could be in place for a decade as suits and countersuits make it through the courts. By transferring the property, he can avoid having the house seized. However, it doesn't mean that he can keep the house if he is convicted of fraud. Any actions deemed to avoid losing assets due to seizure arising from the proceeds of crime laws will be ruled null and void. Selling the property to a related party doesn't get him off the hook, but it puts an asset that can be used to fund a defense temporarily out of harm's way.

This sale was done on the advice of legal counsel.

What people don't realize is that the directors and officers of the company could very well be on the hook for everything they have if the courts rule there was a breach of duty. The reasons are simple;

1. The D&O policy limit will be inadequate to cover the legal costs as well as the compensatory claims and more likely,

2. If there is any hint of criminal wrongdoing, the D&O insurers will invoke the policy exclusion that states that the policy does not indemnify in the event that the loss arises from a criminal act.