Lehman Sends Top Brass Packing

An Einhorn spokeswoman said on Thursday that he would not be commenting on the shake-up.

However, he noted in a May speech that after Lehman delivered a $489 million first-quarter profit, Callan peppered the conference call with words like "strong," "great" and "incredibly" and reportedly received high-fives on the trading floor once she finished her presentation.

However, Callan did not mention that the company still held $6.5 billion worth of risky collateralized-debt obligations, or CDOs, on which it posted a relatively modest writedown of $200 million. A quarter of those holdings were rated non-investment grade. Lehman first disclosed these important facts 22 days after its earnings report, when it filed its quarterly 10-Q report with the Securities and Exchange Commission.

"I asked them how they could justify only a $200 million writedown on any $6.5 billion pool of CDOs that included $1.6 billion of below investment-grade pieces," Einhorn said in May at the Ira W. Sohn Investment Research Conference. Callan declined to provide him an explanation, but said the firm expected further losses.

Those losses were outlined on Monday by Callan herself, along with the $6 billion capital raise. During a conference call, the then-CFO insisted that discussions with potential lenders and counterparties "are not about our viability or the fact that we will be here or the fact that we have sufficient liquidity. I think we put that to bed."

Callan will now return to the firm's investment banking division in a "senior capacity," though Lehman spokeswoman Kerrie Cohen would not say what her specific role would be. When asked for details on why Lehman was making the executive changes, Cohen said: "You have the press release. I think that speaks for itself."