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Friday, April 16, 2010

Goldman Sachs and Barclays could be sued by Lehman Brothers

Lehman Brothers may be able to launch law suits against financial service providers, including Goldman Sachs and Barclays, which purchased discounted assets after its collapse, a legal examiner has said.

Anton Valukas made the comments as part of a 2,000 page report into the failure of the bank.

In the paper, Mr Valukas stated that Lehman Brothers lost $1.2 billion through selling a number of deposits in derivatives to the banks.

He said: “The examiner concludes that an argument can be made that the transfers at issue were fraudulent transfers.”

The bankruptcy expert added that the trustees of Lehman Brothers may be able to make claims for the money to be returned against any of the firms, such as Barclays, DRW Trading and Goldman Sachs, which took advantage of the discounted positions.

Lehman Brothers may also be able to launch legal proceedings against Chicago Mercantile Exchange (CME), the trading exchange which conducted the sale.

According to the report, Goldman Sachs acquired an additional $450 million on equity trades and $150 million from gas positions.

Barclays received $335 million in additional funds from energy trades.

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