AIG probe to include Paulson, Friedman
By Daniel Wagner |
January 18, 2010, Monday
|
Print Edition
Print Edition
A House of Representatives committee is expanding its probe of secretive bank bailouts to include former United States Treasury Secretary Henry Paulson and former Federal Reserve Bank of New York Chairman Stephen Friedman.
The Committee on Oversight and Government Reform has invited Paulson and Friedman to testify about their roles in the bailout of American International Group Inc, according to Democratic Representative Edolphus Towns, the committee's chairman.
Lawmakers want to know more about deals that funneled billions from AIG to banks, including Goldman Sachs Group Inc. Friedman is a Goldman director who resigned from the New York Fed after suggestions he might have conflicts of interest
California Rep Darrell Issa, the committee's top Republican, also said he wants Federal Reserve Chairman Ben Bernanke to answer questions about the bailout, which he helped lead.
A Towns spokeswoman said he is "making decisions daily about witnesses and testimony." A Fed spokesman would not comment.
An earlier watchdog report said the bailouts might have cost taxpayers billions more than necessary because officials did not demand concessions from the banks. The money went to satisfy massive financial obligations that AIG was unable to meet without a government rescue.
The bailouts were managed by the Federal Reserve Bank of New York under the leadership of Treasury Secretary Timothy Geithner, who has defended the deals and will testify on January 27.
Secret details
Issa asked last Friday for Paulson to testify. He asked for the hearing after uncovering e-mails in which New York Fed lawyers told AIG to keep some details secret.
Issa also wanted the committee to demand documents from the Treasury Department and Federal Reserve by issuing subpoenas. He said lawmakers should question Bernanke.
In inviting Paulson, Towns dealt with accusations by Democrats that the hearing was motivated by partisan attacks on Geithner.
Issa insisted the investigation "is not and has never been about Tim Geithner."
The Committee on Oversight and Government Reform has invited Paulson and Friedman to testify about their roles in the bailout of American International Group Inc, according to Democratic Representative Edolphus Towns, the committee's chairman.
Lawmakers want to know more about deals that funneled billions from AIG to banks, including Goldman Sachs Group Inc. Friedman is a Goldman director who resigned from the New York Fed after suggestions he might have conflicts of interest
California Rep Darrell Issa, the committee's top Republican, also said he wants Federal Reserve Chairman Ben Bernanke to answer questions about the bailout, which he helped lead.
A Towns spokeswoman said he is "making decisions daily about witnesses and testimony." A Fed spokesman would not comment.
An earlier watchdog report said the bailouts might have cost taxpayers billions more than necessary because officials did not demand concessions from the banks. The money went to satisfy massive financial obligations that AIG was unable to meet without a government rescue.
The bailouts were managed by the Federal Reserve Bank of New York under the leadership of Treasury Secretary Timothy Geithner, who has defended the deals and will testify on January 27.
Secret details
Issa asked last Friday for Paulson to testify. He asked for the hearing after uncovering e-mails in which New York Fed lawyers told AIG to keep some details secret.
Issa also wanted the committee to demand documents from the Treasury Department and Federal Reserve by issuing subpoenas. He said lawmakers should question Bernanke.
In inviting Paulson, Towns dealt with accusations by Democrats that the hearing was motivated by partisan attacks on Geithner.
Issa insisted the investigation "is not and has never been about Tim Geithner."
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