John Kasich for Governor: Ex-Lehman Bros. Exec Offers History Of U.S. and "The Shirt Off Our Backs"

CINCINNATI (TDB) -- The immigrants gave us the phrase "the shirt off our backs." That was John Kasich's explanation in February 1999 when he announced he was running for president, a very short-lived run in a campaign that went nowhere. Kasich ended up working for Wall Street investment house Lehman Bros., which did know how to take the shirt off people's backs. Lehman's collapse in 2008 helped unleash the Great Recession. Ohio and the U.S. are still feeling the effects. In fact, there are millions of people who can't afford homes, who can't afford to retire, who can't afford college let alone shirts.

Kasich's 1999 presidential announcement speech that threw his shirt into the ring still lives on in cyberspace. His history lesson about how America was settled involves shirts, or lack of them. Read on:

"Your grandmother and your grandfather were living somewhere over in Europe a couple generations ago, and your grandpa told your grandma 'We're going to America.' Your grandma said, 'We're going where? I don't want to go.'
Maybe grandpa had a doubt in his mind, and grandma said 'We're going to America.' But together they made the decision to get in a small boat, it probably leaked, imagine the food, very little water, I would imagine; and they floated across the ocean to a place they didn't know.
And when they landed, they didn't know where they were. When they started traveling across America, they had no clue where they were going to end up, unless they had a relative that made the journey before them.
And you know what they were pursuing? They were pursuing freedom, personal responsibility. They were pursuing rugged individualism and at all times they were compassionate. Because they were the first ones to turn to the person next to them that didn't have anything and said, 'How can I help?' That's when we got the phrase 'the shirt off our backs,' from these immigrants that came across that ocean in search of the American dream. "

Ohio-Based U.S. Appeals Court: Lehman Bros. Must Pay $10 Million To Swindled Clevelanders

CINCINNATI (TDB) -- Wall Street's giant investment house Lehman Bros. Inc. has been ordered to pay $10.4 million to swindled investors, including members of the wealthy Visconsi family, which lost some its shopping mall/real estate fortune in a massive fraud orchestrated by Cleveland-based stockbroker Frank D. Gruttadauria.

Lehman is a global investment banking company, and the ruling is clearly a major setback in its attempts to avoid being tarred with the rogue broker's corrupt activities.

A three-judge panel of the 6th Circuit U.S. Court of Appeals in Cincinnati upheld an arbitrators' award in favor of the victims, whose $21 million investment with the crooked broker dwindled to a few thousand dollars. Yet their statements fictitiously showed millions growing in investment accounts.

Lehman contended the plaintiff's actually profited during the time the company managed their funds. But the appeals court did not buy into the investment bank's claim. Instead, it said Gruttadauria dissipated most of their money before joining Lehman from another brokerage, S.G. Cowen, then stole from other clients to keep his fraud running. The court said there was evidence that Lehman "was aware of significant irregularities" when it bought SG Cowen's business.

The full-text of the 6th Circuit's decision is 12 pages long, and notes that Lehman waged a vigorous legal battle to get its case in front of the arbitrators instead of the courts. Then, when it was hit with the decision for Gruttadauria's victims, Lehman wanted the dispute back in the courts.

"Unhappy with the panel's award -- issued in the very forum it had fought so hard to get into -- Lehman filed in the district court a motion to vacate the arbitration award, arguing that the award was issued in manifest disregard of the law. In February 2006, the district court denied this motion acknowledging that there was 'sufficient support in the record and case law to support a conclusion that Lehman [was] jointly and severally liable.'"

The court said there was little doubt the wealthy Visconsi's were victims of a shady operator.

"Plaintiff s gave $21 million to Gruttadauria, not to hide under a rock or lock in a safe, but for the express purpose of investment, with a hope -- indeed a reasonable expectation -- that it would grow . . . Had Gruttadauria invested plaintiff's money as requested, their funds would have likely grown immensely, especially considering that plaintiffs invested primarily through the mid-1990s, which, had they hired an honest broker or a watchful company that reasonably supervised its employees, would have placed their money in the stock market during one of the strongest bull markets in recent memory."

The court calculated the victims missed out on more than $37.9 million in growth from their investments.