Tuesday, November 30, 2010
Lehman Bankruptcy in Court: Barclays Pushes for Dismissal of SEC’s Claim
UK bank Barclays Plc is pushing for a US bankruptcy judge to dismiss a claim by the US Securities and Exchange Commission in one of three bankruptcy lawsuits against Barclays related to the Chapter 11 bankruptcy of Lehman Brothers in 2008, which was by far the largest bankruptcy in history. The SEC is asking the court to rule that two transfers totaling over $1.2 Billion in assets and securities from Lehman’s brokerage to Barclays violate securities law.
Lehman Brothers Holdings, Inc is waiting for the judge to rule on its suit over what it calls an $11 Billion windfall reaped by Barclays from its 2008 purchase of Lehman. Barclays has pointed out the huge risk the firm took in purchasing Lehman, for which Barclays was the only bidder. At the time of the purchase, the SEC gave its support to the deal without reservations. Barclays says that the SEC is now backtracking on its earlier position in order to avoid “political criticism.”
Barclays maintains that it is still owed $3 Billion, including the transfers under review, but the SEC is trying to block payment of those funds in bankruptcy court. Bankruptcy attorneys involved in the case expect Judge James Peck to rule in January or February 2011.
1 Comments:
Barclays sought to have the lawsuit dismissed, arguing that if there were ... A bankruptcy court approved the deal. Now, however, Lehman claims that the Sale ... for six bankrupt companies. Neither admitted or denied the SEC's claims.
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