Council manager admits confusion
THE general manager of a NSW council has admitted to confusion and a lack of understanding about the financial products the council invested with Lehman Brothers Australia in early 2007, a court has heard.
Michael Hyde said he understood from Lehman Brothers that the council could redeem its multi-milliondollar investment at face value within three days.
Mr Hyde also told the Federal Court in Sydney he had believed the investments would mature within two to three years, but later discovered they were not due to mature until 2047.
The Wingecarribee Shire Council is suing the liquidator of Lehman Brothers Australia, formerly Grange Securities, to recover $ 21.4 million in losses.
The landmark case, which involves 72 local councils and charities, has heard evidence by three senior Wingecarribee employees, who each testified that they told Grange not to i n v e s t i n c o l l a t e r a l i s e d d e b t obligations. Lawyers for Lehman Brothers argued the staff never gave those instructions.