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expected to attend--even ones that weren't directly related to Lehman.

Kathy Fuld collected modern art. She particularly liked Cy Twombly, Brice Marden, and

Jasper Johns. In 2002, she was put on the board of the Museum of Modern Art (MoMA),

and by 2007 was a vice chairman. Not only were the wives of Lehman's senior

management expected to attend MoMA evenings (along with their husbands), but they

also "were told exactly how much they had to donate," says one. There is now a wing of

MoMA dedicated to Kathy and Richard S. Fuld Jr.

Whatever his influence and his success at marriage, not even Dick Fuld was powerful

enough to abolish divorce. In April 1999, Teresa Gregory filed for divorce. No one was

surprised. Joe 'd often asked colleagues about their wives and exclaimed how beautiful

they were. Teresa Gregory was athletic and fun, but according to one of Gregory's

colleagues, "she didn't fit in at the Lehman dinners."

Karin Jack recalls one evening at the Fulds ' apartment in the city when Teresa Gregory

was left standing on her own. "She needed help, guidance, and Joe didn't give her any,"

Karin recalls.

By 2000, Joe Gregory had remarried, to a dark-haired Greek-born beauty named Niki

Golod, who was recently divorced. Gregory and Golod had met through their sons, who

were best friends at school.

"Isn't it great that now they' ll be stepbrothers?" he used to say to colleagues.

Niki Gregory loved the clothes and the jewels that her husband lavished on her. She was

known to take trips to Los Angeles just to shop. She gave the Lehman wives tours of her

vast shoe closets in their Huntington home. One person taken on the tour described the

closet as being "twice the size of the Jimmy Choo store in New York." It was filled with

Christian Louboutin, Manolo Blahnik, and Chanel. It included every style imaginable:

pumps, stilletos, boots of every height, ballet flats, strappy evening heels. "Many of them

had never been worn," remarked one awed visitor.

Like her husband, Niki outsourced all her needs to a personal staff of about 30. "I don't

think she ever set a table in her life for a dinner party," said one wife. "It wouldn't occur

to her to do that."

After Niki was diagnosed with breast cancer and had a mastectomy, Lehman executives

(at Gregory's request) were told to give like crazy to breast cancer awareness. "For the

senior-level guys it was approximately 50 grand each; for the executive committee,

approximately 100." Fran Kittredge, who was responsible for planning all Lehman's

corporate events (even overseeing the details of the flower arrangements, which she had

photographed and e-mailed to her before green-lighting them), told people what "their

number was" each year.

The firm gave to political candidates as well. Fuld, say colleagues, was not loyal to either

party; he went with whichever candidate he liked. The firm made sure it donated equally

to both parties. However, since most of the executive committee, including Fuld, were

Democrats, if a Republican looked like he might vault into the White House, Steve

Lessing (a Republican) was designated to "handle" him. In 2007, after he'd retired as

governor of Florida, Jeb Bush was made a private equity adviser and given an office on

the 31st floor.

The executive committee members and their wives were all expected to attend the annual

summer get-together at Dick and Kathy's ranch near Bald Mountain in Sun Valley, Idaho.

One wife remembers, "It was this weird combination of business and then competition

between wives and their husbands. Hiking was mandatory for all."

Karin Jack says that trip was always "an absolute nightmare for the wives to pack for."

The evenings required pretty dresses, jewelry, and Manolo Blahnik shoes, while they

needed hiking gear during the day.

The couples got there on the two planes owned by Lehman, known as "Lehman Air." The

biggest--a G4 luxury jet--was known as LB1. That was the plane Fuld always used.

Kittredge arranged for every