The House Financial Services Committee plans to probe the regulatory failures that led up to the collapse of Lehman Brothers after a bankruptcy examiner released a damning report last week on the investment bank’s accounting manipulations.

The report, by Jenner & Block chairman Anton Valukas, detailed Lehman’s abuse of “repo transactions” to shift $50 billion worth of assets off its balance sheet at the end of the first and second quarters of 2008 in order to report far less debt than it actually had, while claiming the transactions as sales rather than financings. Valukas found that the SEC did not force Lehman to change the way it accounted for its liquidity pool, which Lehman claimed was far larger than SEC regulators believed it to be. Many of the assets were not readily convertible to cash or had already been pledged as collateral to clearing firms.

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