The Guardian reports that 'a breakdown of communication at the highest level' between London and Washington lead to the collapse of Lehman Brothers, which, in turn, ushered in the worst banking crisis for over 80 years.

The newspaper claims that the UK Treasury, the Bank of England and securities regulator The Financial Services Authority all believed that the US government would step in to prevent a Lehman bankruptcy, and had made it clear that any bid by Barclays for Lehman could only progress if there was a US government backstop. The US Treasury, led at the time by former Goldman CEO Hank Paulson, claims, however, that it was only at the last minute that UK Chancellor Alistair Darling mentioned this condition - when it was too late for the Bush administration to do anything about it!

In the meantime, The Wall Street Journal's Heard on the Street Column reports that, according to Friday's unemployment report, an additional 28,000 financial markets jobs were lost in the month of August, taking the tally to 373,000 over the last 12 months.

And The New York Daily News reports that New York Governor Paterson said last week that going after banker bonuses wasn't such a good idea, as, 'at the end of the day, when they shut those bonuses down, they were shutting New York State down. That's where we got our taxes'.

Bloomberg reports that J. Ezra Merkin's Ariel Fund and Gabriel Capital have asked a New York bankruptcy judge to dismiss a claim of $557.8m filed by the liquidator of Bernie Madoff's investment firm.

And The Daily Telegraph reports that US regulator The Securities and Exchange Commission (SEC), humiliated because of its shortcomings over the Madoff affair, is considering establishing a 'fraud college' for would-be SEC investigators.

Finally, The Wall Street Journal reports that it looks likely that Daiwa Securities will buy out partner Sumitomo Mitsui Financial Group's 60% stake in their 10-year joint venture, Daiwa Securities SMBC.

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