The Fall of the Lehman Brothers Could IT Have Been Avoided?

The bankruptcy Lehman Brothers filed in September of 2008 triggered a spillover from which world economies still in recovering. The collapse of Lehman Brothers resulted from poor corporate governance unethical accounting practices, and excessive risk exposure (Presley & Jones, 2014). Additionally, excessive derivatives trading, enormous levels of leverage, and lack of liquidity, poor risk management, and self-regulations (Christopoulos, Mylonakis & Diktapanidis, 2011). The company unethically applied Repo105 and 108 to transactions that were not disclosed to the Security and Exchange Commission (SEC) (Valukas, 2010). Stewart & Eavis, (2014) noted that the government could have bailed out Lehman Brothers based on the accounts prepared by the Federal Officials, but the Feds thought that the legal authority was out of their hands. Today, however, current and former officials are now convinced that Lehman Brothers were marginally solvent and might have qualify for a bailout (Stewart & Eavis, 2014). This paper explored the circumstances surrounding the failure of Lehman Brothers and found that the event should have been averted especially based on the size of the company and its value of its assets