Ex-Lehman CEO a big donor

Author: Kelly Janis

In the latest iteration of a close financial relationship, College trustee and ex-CEO of Lehman Brothers Richard S. Fuld, Jr. donated the 15 offset lithographs and silk screen prints which constitute the centerpiece of the College Museum of Art's new exhibition, "Confronting History: Contemporary Artists Envision the Past." Fuld has received grand jury subpoenas in criminal investigations probing the role of possible securities fraud in the collapse of the 158-year-old Wall Street firm over which he presided.

Chief Curator Emmie Donadio said she had acquired the portfolio, Kara Walker's 2005 Harper's Illustrated History of the Civil War (Annotated) last year, but would not disclose its appraised value.

"Since these are gifts rather than purchases at auction, issues of price and value are not public," Donadio wrote in an e-mail. "We generally do not focus on the monetary value of works of art in the collection, since that kind of attention tends to compete with - and sometimes to obscure - the reasons why we acquired them, or assembled them for exhibition, in the first place."

Fuld, who received $71.9 million in compensation in 2007, is believed to have lost nearly $1 billion in Lehman's bankruptcy, the largest in history. In November, shortly after the announcement that he would step down as the firm's chief, Fuld and his wife, parents of 2003 and 2007 graduates of the College, fetched $13.5 million at Christie's Auction House in New York City for 16 post-war drawings initially expected to draw $15 to 20 million. The same week, Fuld transferred full ownership of one of his five luxury homes - a $13.75 million beach-front mansion in Florida - to his wife for $100. Many have speculated that this move was intended to protect his assets from creditors threatening lawsuits.

Meanwhile, in addition to continuing his service on the College's Board of Trustees until 2013, Fuld - referred to by The New York Times as a "notable squanderer of American wealth" - remains the co-chair of the Middlebury Initiative, a five-year, $500 million fundraising effort aimed at establishing Middlebury as the "first truly global liberal arts college."

The College does not comment on the contributions of specific individuals unless they are in conjunction with a particular event, such as the dedication of a building in a donor's name. The Kathy and Richard S. Fuld, Jr. Family Foundation's IRS Charitable Contribution Summaries from the past three years, however, reveal that Fuld's financial impact on the College has been hefty. The Fulds contributed $2.3 million to the College in 2006 alone, the year Richard Fuld ranked 374th on Forbes Magazine's list of the richest people in America.

The media and blogosphere have buzzed with repudiations of Fuld in recent months, most prefacing his name with "embattled" or "disgraced."

In December, Fuld joined former president George W. Bush, Sen. John McCain (R-AZ.) and Secretary of State Hillary Clinton on Time Magazine's list of 20 "People Who Mattered in 2008." While acknowledging that the government's unwillingness to bail out the firm may have worsened the financial crisis, the write-up accused Lehman of borrowing recklessly under Fuld, and noted that members of Congress implied that he had profited from the firm's collapse. Time - which declared Fuld one of the biggest "losers" of the "Wall Street mess" in another article - wrote that "every tragedy needs a villain, and with his deep-set eyes, gruff voice and hundreds of millions of dollars in pay, the Lehman Brothers CEO was perfectly cast as the bad guy of the recession."

New York Times op-ed columnist Nicholas Kristoff targeted Fuld in a piece titled "Need a Job? $17,000 an Hour. No Success Required," proclaiming him the winner of his "annual Michael Eisner Award for corporate rapacity and poor corporate governance."

Overseas, The Times of London said that Fuld, "whose combative nature earned him the nickname 'The Gorilla,' has become the symbol of everything that was wrong with Wall Street."

Fuld said in sworn testimony before the House Committee on Oversight and Government Reform that he believed his decisions at Lehman "were both prudent and appropriate," and that he did not intentionally mislead or defraud investors.

"I wake up every single night wondering what I could have done differently," Fuld said. "This is a pain that will stay with me the rest of my life."

In a Sept. 25 2008 article in The Campus, Senior Associate Director of the Career Services Office Don Kjelleren called Lehman Brothers a "big fish" at the College. The firm was a stronghold in the CSO's annual "Day in the Life" event in New York City and furnished students and alumni with jobs, internships and Winter Term projects.

In a recent e-mail, however, Kjelleren downplayed the bankruptcy's impact on the estimated five to 12 graduates a year who signed on at the firm during its prime.

"My understanding is that most of the Middlebury alumni went over to Barclays and now await the same fate as everybody else on Wall Street or in the workplace in general," he wrote.

Barclays Capital - an international investment bank that absorbed approximately 9,000 of the 25,000 employees who remained when Lehman Brothers went under - announced last month that it will cut 2,100 jobs.

"Richard Fuld is a valued trustee of Middlebury College," said President of the College Ronald D. Liebowitz in a statement released the day after Lehman Brothers filed for Chapter 11 bankruptcy protection. "His work in this role has helped contribute to the success of the College and reflects his strong commitment to higher education."

Executive Assistant to the President Betsy Etchells said Liebowitz's stance remains unchanged.