Dick Fuld was chairman and chief executive officer of Lehman Brothers, the investment bank that filed for bankruptcy in September 2008.
Fuld was a Lehman Brothers lifer: He joined the firm as an intern in 1966 and earned a full-time job as a bond trader after graduating business school in 1969. Twenty-four years later, he took over as Lehman's CEO. But when Fuld first took the reigns as chief executive in 1994, the firm was hardly a powerhouse. The once-vaunted blue-chip partnership that boasted alumni like Pete Peterson, Lew Glucksman, Steve Schwarzman, and Eric Gleacher had withered in the years following its acquisition by Shearson/American Express, and Fuld's ascension to the top spot followed Amex's decision to spin off the unit as a separate entity. Turning around the company was no small task. The fallout from the collapse of the hedge fund Long-Term Capital in 1998 prompted rumors that Lehman was about to go belly-up, and the attacks of Sept. 11th rendered the firm temporarily homeless when the collapse of the World Trade Center damaged the firm's headquarters at the World Financial Center. Fuld managed not only to survive the crises but also take Lehman to impressive new heights: When he took over as CEO, Lehman had annual earnings of $75 million. By 2006, that number blossomed to $4 billion as Fuld successfully transformed Lehman into one of the most competitive banks on the Street. His legacy, however, unraveled during the credit crisis of 2007-8. After months of rumors about Lehman's impending demise, the bank filed for bankruptcy in September 2008.
A few years ago, conventional wisdom dictated that pure-play investment boutiques like Lehman were largely doomed and had little chance competing against financial supermarkets like Goldman Sachs, Merrill Lynch and Morgan Stanley. But Lehman managed to give its competitors a run for their money in the early '00s: Building on the firm's longstanding tradition as a bond house, Fuld diversified the firm into stock trading and investment banking, expanded overseas, invested in several prominent hedge funds (such as David Shaw's D.E. Shaw), and presided over several major acquisitions, including the $2.3 billion purchase of Neuberger Berman in 2003.
The situation for Lehman dramatically changed in 2008 amid the global credit crisis and the implosion of Bear Stearns. Widespread rumors that Lehman would be the next bank to fail prompted a precipitous decline in the bank's stock price and an influx of short-sellers. Despite Fuld's efforts to cut costs, reduce staff, and raise additional capital, Lehman was forced into bankruptcy on September 15, 2008. Critics have since argued that Fuld was slow to address the unfolding financial crisis and shore up the company's balance sheet and his decision to not seek out a buyer for the firm sooner made a bankruptcy unavoidable.
Fuld pocketed some $40 million in 2007, roughly the same amount he took home in 2006. Thanks to his substantial holdings of Lehman stock, Forbes estimated his net worth at $1 billion just before the credit crisis began in 2007. His fortune evaporated during Lehman's final few months.
Fuld and his wife Kathy have three kids, Jacqueline, Chrissie, and Richie, and own an estate in Greenwich. Although they purchased an apartment at 640 Park from the estate of the late publishing heiress Evelyn Annenberg Jaffe Hall for $21 million in 2007, they were later forced to sell the 6,200-square-foot spread to MSD Capital co-founder Glenn Fuhrman for $25.87 million in 2009. Nonetheless, they still own a number of lavish vacation homes across the country, including mansions in Florida—they paid $13.75 million for a spread on Jupiter Island in 2004—Vermont, and Idaho.
The intensely competitive Fuld is also a championship-level squash player. His Greenwich estate is home to an indoor court that he says he uses daily.