Let's Make a Deal

For a guilty plea and $650 million, Drexel hopes to get a clean slate

Christmas was just around the corner, but the videotaped tidings that Frederick Joseph handed out to the TV networks last Wednesday evening were not exactly festive. Looking tired and tense, the silver-haired chief executive officer of Drexel Burnham Lambert discussed the settlement that Drexel had reached that day with federal prosecutors to end the largest probe ever of a U.S. securities firm. Declaring that the long-awaited agreement "makes sense from a business and human point of view," Joseph, 51, tried to be upbeat. The deal, he said, would leave the firm "in a very strong financial position, and allows us to...

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