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A breakdown in communications at the highest level between the US and the UK led to the shock collapse of the investment bank Lehman Brothers in September last year, a Guardian/Observer investigation has revealed. The downfall of Lehman, which triggered the biggest banking crisis since the Great Depression, came after a rescue bid by the high street bank Barclays failed to materialise.

Wall Street banks are reaping outsized profits by trading with the Federal Reserve, raising questions about whether the central bank is driving hard enough bargains in its dealings with private sector counterparties, officials and industry executives say. The Fed has emerged as one of Wall Street’s biggest customers during the financial crisis, buying massive amounts of securities to help stabilise the markets. In some cases, such as the market for mortgage-backed securities, the Fed buys more bonds than any other party. However, the Fed is not a typical market player. In the interests of transparency, it often announces its intention...

Al Gore’s campaign against global warming is shifting into high gear. Reporters and commentators follow his every move and bombard the public with notice of his activities and opinions. But while the mainstream media promote his ideas about the state of planet Earth, they are mostly silent about the dramatic impact his economic proposals would have on America. And journalists routinely ignore evidence that he may personally benefit from his programs. Would the romance fizzle if Gore’s followers realized how much their man stands to gain? Earlier this year Gore experienced a notable public relations debacle. The Tennessee Center for...

MELANIE PHILLIPS, WRITING EXCLUSIVELY FOR MAIL ONLINE Worried that Britain is going bankrupt? Cheer up – we’re about to be bought up by the Islamic world. A report by International Financial Services London reveals that Britain’s Islamic banking sector is now bigger than that of Pakistan. The study says that the UK has by far the largest number of banks for Muslims of any western country. The UK now has five fully ‘sharia-compliant’ banks – providing products which prohibit interest payments and investment in alcohol or gambling firms in accordance with Islamic sharia law – while another 17 leading institutions...

The Barclay brothers' representative is to return to Sark to open talks on safeguarding jobs in the wake of their decision to withdraw their investment from the Channel island. Sir David Barclay (left) and his twin brother Sir Frederick Barclay after receiving their knighthoods in 2001 Kevin Delaney, of Sark Estate Management, the company which administers the Barclays' properties on Sark, is due to return this week to see if the islanders still want them to be involved in some way in its affairs. The brothers decided to withdraw their £5 million-a-year investment after Sark's residents failed to back their...

London shares dropped more than 400 points in early trading this morning after a seventh day of devastating falls on Wall Street triggered panic selling across Europe and Asia. Within minutes of opening, the FTSE 100 index fell almost 10 per cent to its worst level since 2002, but within 30 minutes shares staged a mild rally which left the index of Britain's leading companies off 253 points at 4050. Bank shares took the brunt of the pain as markets gyrated with Barclays off 15.6 per cent, and HSBC down 4.3 per cent. BP fell 8 per cent and Royal...

STAFF at Lehman’s New York office who helped to cause the world’s biggest corporate bankruptcy are to share in a $2.5 billion bonanza. The bonus, which has been described by London staff as a “scandal” has been pledged by Barclays Capital, the British-based bank that last week acquired Lehman’s American operation and took on 10,000 staff. The $2.5 billion (£1.4 billion) pot, which has been ring-fenced as part of the acquisition, has caused huge resentment among the 5,000 staff in the firm’s European and Middle Eastern operations who are not guaranteed to be paid after this month. There are, however,...

Fury at $2.5bn Lehman bonus Nomura and Barclays table bids today for US giant’s London operation as bank’s administrator likens collapse to EnronJohn Waples and Danny Fortson STAFF at Lehman’s New York office who helped to cause the world’s biggest corporate bankruptcy are to share in a $2.5 billion bonanza. The bonus, which has been described by London staff as a “scandal” has been pledged by Barclays Capital, the British-based bank that last week acquired Lehman’s American operation and took on 10,000 staff. The $2.5 billion (£1.4 billion) pot, which has been ring-fenced as part of the acquisition, has caused...

U.K. Prime Minister Gordon Brown said Saturday that he is working with U.S. authorities to get billions of dollars returned to Lehman Brothers Holdings Inc.'s London operations from the firm's U.S. business. Responding to questions at the start of his Labour Party's conference, Mr. Brown said he wanted to make sure the money was returned in the interest of the investment bank's U.K. employees. The transfer of $8 billion has become a target of inquiry by Lehman clients as well as PricewaterhouseCoopers LLP, which is overseeing the insolvency proceedings of Lehman units in London. Within the past several days, PricewaterhouseCoopers...

A U.S. bankruptcy judge approved a revised version of Barclays' deal to purchase the core U.S. business of Lehman Brothers. In a Manhattan court hearing that started on Friday and lasted past midnight, U.S. Bankruptcy Judge James Peck approved the sale, saying he had found no better alternative for the assets Lehman sought to sell. "This week more than any other week since I was appointed to the bench I have felt the awesome power of this job," Peck told a packed Manhattan court room, at the end of a nearly seven-hour hearing

Lehman Brothers has agreed to sell its North American investment banking and capital markets businesses for $1.75bn to UK lender Barclays, which will use the acquisition to boost its US investment banking prowess without having to assume Lehman’s crippling liabilities.

The possible collapse of one of world's biggest investment banks could be "catastrophic" and lead to the "implosion" of the banking sector, Sky sources say. British bank Barclays had appeared to be the frontrunner to take over the struggling Lehman Brothers but has pulled out of the bidding, a source close to the deal said. And a consortium led by the Bank of America is reported to have also dropped out. ~ snip ~

Unable to find a savior, the troubled investment bank Lehman Brothers appeared headed toward liquidation on Sunday, in what would be one of the biggest failures in Wall Street history.

The fate of Lehman Brothers Holdings Inc.'s darkened early Sunday afternoon with Barclays PLC, the sole remaining bidder for the 158-year-old Wall Street firm, telling federal regulators that it is walking away from a transaction, people familiar with the matter say. The situation was rapidly evolving, and it's possible Barclays or another bidder would emerge to save Lehman before markets opened Monday. But with the government balking at putting any taxpayer money at risk for Lehman, the likelihood of a transaction was dimming. That would leave an orderly liquidation as the most likely scenario, a dramatic outcome for a once-powerful...

Barclays PLC, the U.K.'s third-largest bank, is emerging as a leading contender for Lehman Brothers Holdings Inc. as discussions continued Sunday in London and New York in what is a highly fluid and pressure-charged environment. A sale of Lehman to either Barclays or Bank of America Corp. remained dependent on government financial support, according to people familiar with the situation. According to these people, Barclays appeared to be moving more aggressively in trying to find a way to complete a deal.

Bank of America, JC Flowers & Co, the financial investor, and China Investment Co, the Chinese sovereign wealth fund, are considering a possible joint bid for Lehman Brothers, the embattled Wall Street bank. According to people familiar with the matter, the BofA-led group is among those examining a rescue of Lehman, which is racing to find a buyer after shareholders, creditors and counterparties gave a thumbs-down to its efforts to survive as an independent entity. Barclays, the UK bank, is also interested.

There are fewer than a million people in the tiny Gulf state of Qatar and fewer than 200,000 of them are ethnic Qataris. Yet this week a state fund that invests on behalf of the Qatari people and a private fund owned by the country's prime minister and his family agreed to buy nearly 8pc of Barclays, a bank with a market cap of almost £20bn. And for the state fund, a billion or so on Barclays is small change. The Qatar Investment Authority (QIA) already has $60bn (£29bn) of assets and expects to spend billions of pounds more overseas...

Barclays accused of giving Robert Mugabe 'financial lifeline' By Maurice Gerard Last Updated: 3:06am BST 14/06/2008 Barclays Bank is being accused of giving Robert Mugabe's government a "financial lifeline" in the run-up to Zimbabwe's presidential election, it emerged yesterday. A Barclays spokesman said the bank provided essential services to ordinary Zimbabweans Barclays' Zimbabwean subsidiary lent the Mugabe regime $46.4 million (£23 million) last year through its purchase of government and municipal bonds and is one of the main contributors to a government-run loan scheme for farm improvements, the Agricultural Sector Productivity Enhancement Facility (Aspef). At least five ministers have received...

LONDON - Barclays Group PLC took a US$2.7 billion writedown for losses on securities linked to the U.S. subprime mortgage market collapse - less than the market had expected - in a surprise trading update Thursday. Barclays, which was not due to provide an update until later this month, revealed the loss in its Barclays Capital investment unit following investor criticism over its silence and after market rumors over the past week of a much larger writedown weighed heavily on its share price. Shares in the bank jumped more than six per cent after the update showing a 500 million...

President Robert Mugabe's government has published a bill to move majority control of "public companies and any other business" to black Zimbabweans. The goal is to ensure at least a 51% shareholding by indigenous black people in the majority of businesses. Critics say it could hurt investor confidence in Zimbabwe, suffering from the world's highest inflation and food, fuel and foreign currency shortages. Now the Indigenisation and Economic Empowerment Bill will go to parliament.

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A call center employee says he has been dismissed from his job for posting an artist's rendition of the crucifixion during Easter week, even though other employees were allowed to post pictures and art as they chose in their cubicles. Chris Romansky, a former employee of Barclays, told WND he was told there had been a complaint about the picture he put up to remind himself of Christ's sacrifice on the cross, a foundational belief in Christianity. A company spokeswoman, Donna Sokolsky, told WND that the job termination "had nothing to do with anything religious whatsoever." But she said she...

It's spring, and at the Indian Institute of Management - a premier management school in this industrial town - the campus is abuzz with company recruiters offering fat pay packages to new grads. . Bagging a $185,000 per year offer, Manan Ahuja, an affable 26-year-old lad, coyly notes that his salary package offered by Barclays Capital, a British investment bank, is far more than his father, a Delhi government bureaucrat, earned in his entire lifetime. "It feels great to get an international offer," Mr. Ahuja says. "Beyond the salary, this promises an interesting job profile and great growth prospects." Ahuja's...

Investigators into the collapse of the Italian dairy giant Parmalat are turning the spotlight on America's big investment banks. Italian magistrates and officials from the powerful Securities and Exchange Commission are examining the role of lenders to Parmalat - which collapsed into administration last month following the disclosure of an €8 billion (£5.6bn) hole in its finances. These lenders include some of the US's largest financial institutions. An SEC source said that while at this stage an investigation did not imply wrongdoing by the investment banks, it was focusing on placements of notes and bonds in the US. But he...