Henry Paulson

Treasury Facing More HR Problems On Bailout?

Zachary Roth | November 28, 2008, 2:20PM

Earlier today we noted that the Treasury Department had hired staff with the specific attributes needed to carry out its original plan for the bailout -- buying banks' bad assets -- only to then decide that it would change its approach by directly injecting capital. That news raised questions as to whether the department has the right people in place for what's an extremely complex and crucial task.

And a report in today's Wall Street Journal sheds a bit more light on the hiring issues that have plagued Treasury's response to the crisis. It reveals that the department is struggling to bring on enough people to handle the glut of applications for assistance that are flooding in from troubled financial institutions.

Neel Kashkari, the man running the TARP program, said at a recent at a luncheon before a housing organization that the department's Office of Financial Stability is operating at half-staff, with about 40 full-time employees. Kashkari said he hopes to double that number by the time the Obama administration takes over on January 20th.

(And by the way, granted Kashkari needs to keep the pubic informed on what he's doing, but doesn't he have more pressing matters to attend to right now than attending luncheons?)

The Journal adds, not exactly reassuringly:

In the past month, the Treasury has been scrambling to make major policy decisions while at the same time conducting the nuts-and-bolts tasks of finding a permanent staff. Decisions have largely been left up to interim staff members, many from other federal banking regulators, who are temporarily at Treasury but are expected to eventually return to their previous positions.

Part of the manpower problem here may be caused by the impending transition. According to Wayne Abernathy, an executive at the American Bankers Association, many Treasury staffers may be headed for the door in advance of the changeover, making it especially hard to keep the department fully-staffed.

Abernathy also suggests, intriguingly, that it may have been in part because of this very problem that Treasury switched from the asset-buying approach to the capital-injection approach. "I don't think that was a small part of why Treasury in the end abandoned the asset-purchase program," he told the paper. "It's very people-intensive."

But it doesn't appear that the switch has entirely solved the problem. And if, in addition to having too few people, Treasury also has the wrong people, as was suggested by that earlier report we noted, that would hardly help the situation.

This may have more to do with a desperate and extraordinary situation than with any deliberate malevolence or even incompetence, but given the stakes, the Treasury's personnel problems are worth keeping an eye on nonetheless.

Bailout

Unnamed GOP Senator Blocking Appointment Of Key Bailout Overseer

Zachary Roth | November 28, 2008, 12:52PM

Here's an interesting nugget in Congress's response to the financial crisis that hasn't received as much attention as it deserves.

Earlier this month, the Bush administration nominated Neil Barofsky, a federal prosecutor, to be the Treasury Department's special inspector general on the bailout program. That's a crucial post, given the astronomical sums at issue, the broad authority that Treasury has been given to distribute them, the concerns that have been raised about possible conflicts of interest, and the general urgency of our efforts to prevent an economic collapse.

So you'd think Congress would be doing everything it could to get Barofsky confirmed right away. You'd be wrong.

Last week, Sen. Chris Dodd, the Connecticut Democrat who chairs the banking committee, issued a little-noticed statement saying that although the nomination "was cleared by members of the Senate Banking Committee, the leadership of the Senate Committee on Homeland Security and Governmental Affairs, and all Democratic Senators," it was "blocked on the floor by at least one Republican member." (itals ours.)

Senate rules allow any senator to anonymously block a vote on confirmation to any federal post, for any reason.

The rationale for the move remains unclear. But a Washington Post story from a few days before Dodd's statement offers two suggestions. It notes that Barofsky supported Barack Obama, and describes an unresolved "battle between the Finance and Banking committees over which has jurisdiction over the confirmation process."

Blocking an urgent nomination because the nominee, like 52 percent of voters, supported Obama seems petty even by contemporary GOP standards. But a congressional turf war over jurisdiction seems only slightly less so. So either of these two explanations would be a pretty damning indictment of Congress's response to the crisis.

We'll keep you posted as we dig into this...

Treasury Department

Report: Treasury Hired Staff For Original Bailout Plan, Not Revised Mission

Zachary Roth | November 28, 2008, 11:36AM

The Treasury Department had originally intended that the $700 billion of TARP bailout money would go to buying up the bad assets of banks and other financial institutions. But then, as was widely reported, Treasury Secretary Hank Paulson reversed course last month and announced that he would take an entirely different approach, using the money simply to inject new capital into troubled banks.

What have we lost through this flip-flopping? It's impossible to know for sure, but one line from a Tuesday New York Times report offers a hint. The paper notes an interesting finding in an audit of the rescue plan, conducted by the Government Accountability Office:

Treasury already had hired staff members for the initial mission, some of whom were not necessary or best suited for the work required under the new strategy.

So have new staff members, who have specific expertise in the issues involved in the new strategy, now been hired? Or is Treasury assigning the crucial task of rescuing the nation from financial collapse to staffers who aren't the best people for the specific job? We'd love to know.

The rest of the expected contents of the GAO report are hardly more encouraging. The Times says the report "is expected to be critical of the Treasury Department's failure to set up ways to track how its bailout money is being used in the marketplace."

It's also "likely to call for tighter controls over the conflicts of interest that are arising as financial specialists, institutions and law firms are hired for Treasury work that could later aid their private-sector clients."

Both of these potential problems have been highlighted by members of Congress and others in recent weeks.

More on this when the report is officially released next week...

Global Warming

White House To Allies: Tell Us Why We Shouldn't Regulate Carbon. No Really, Tell Us. Please.

Zachary Roth | November 28, 2008, 10:09AM

It may seem like President Bush has all but stopped doing his job lately. But his White House is still working as hard as ever at blocking efforts to fight global warming.

Case in point -- the Washington Post reported Wednesday:

Last week, the White House Office of Intergovernmental Affairs sent an e-mail to mayors reminding them that time was running out if they wanted to comment on the proposal the administration issued in July, which laid out how the government might curb greenhouse gases under the Clean Air Act. A 2007 Supreme Court decision required the Environmental Protection Agency to issue such a ruling, but the White House made it clear in its e-mail that it does not think that is a good idea.

The email, sent by Jeremy Broggi, the office's associate director, clearly encourages the mayors to express opposition to limits on greenhouse gases. It says:

At the time, President Bush warned that this was the wrong way to regulate emissions. [House Energy and Commerce Committee] Chairman John D. Dingell called it 'a glorious mess. And many of you contacted us to let us know how harmful this rule would be to the economies of the cities and counties you serve.

It then links to a blog post by the U.S. Chamber of Commerce, a staunch opponent of efforts to regulate emissions, arguing that caps on greenhouse gases "will operate as a de facto moratorium on major construction and infrastructure projects." And it reminds recipients that the comment period for the rule-making closes November 28th.

"It appears there is no bottom to the administration's pit of disdain for regulating greenhouse gases," William Becker, of the National Association of Clean Air Agencies, told the Post.

Hard to put it better than that.

The Daily Muck

The Daily Muck

Natalie Sherman | November 28, 2008, 9:49AM

Former AIG executive Joseph Cassano, who ran the company's financial products division, is facing a federal investigation into whether he "misled auditors and investors" about the mortgage company's finances. AIG terminated Cassano's contract the day before the company went before a congressional panel in October. At the hearing, legislators pointed to the activities of Cassano, who made $280 million during his eight years at AIG, as a major factor in the company's collapse. (Washington Post)

Rep. William Jefferson (D-LA) filed yesterday for the 4th Court of Appeals to drop most of the criminal charges against him, a motion, which, if granted would overturn an earlier decision by a subset of the court's judges. Jefferson is on trial for corruption related to Nigerian business deals. His case rests on his broad interpretation of the "speech or debate" clause in the Constitution, which bars members of congress from being prosecuted for transgressions committed in connection with their legislative duties. (Times Picayune)

Former defense contractor Mitchell Wade, who pleaded guilty in 2006 to bribing former California GOP congressman Randy "Duke" Cunningham, is asking for a lighter sentence in return for his cooperation with federal corruption investigations, according to papers filed Wednesday by his lawyers. As it stands currently, Wade faces a minimum of nine years in prison; he has asked for "a year of home detention, a fine of $250,000, five years probation and substantial community service." Wade has provided information for probes of government employees, private contractors and five members of Congress in addition to Cunningham.

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Ted Stevens

Hearing Scheduled For Witness Who Claims He Lied in Stevens Case

Zachary Roth | November 26, 2008, 3:47PM

Last week we told you about a letter sent to the judge in the Ted Stevens trial, from a witness claiming that he lied on the stand when he said he had no immunity deal with prosecutors.

Now, reports the Washington Post, the judge, Emmet Sullivan, has scheduled a hearing for Monday to consider a request from Stevens' lawyers to question the witness, David Anderson, a welder who worked on Stevens' home.

Anderson also alleged in his letter that prosecutors allowed him to look at documents he wasn't supposed to see.

Based on Anderson's claims, defense lawyers last week filed documents accusing prosecutors of "suborning perjury and making intentionally false statements." The Justice Department has denied the allegations.

Stevens was convicted last month of making false statements on his Senate disclosure forms, hiding $250,000 in gifts from Bill Allen, the owner of an oil-services contracting company -- and Anderson's uncle. Shortly afterwards, he narrowly lost his Senate reelection bid.

And speaking of Uncle Ted, at last the wait is over. We've updated our "Ted Stevens' Road To Ruin" timeline, so you can now see in glorious technicolor just how the curmudgeonly lawmaker got to this point. Check it out...

Ben Bernanke

What We're Doing -- And Spending -- To Stave Off A Financial Collapse

Zachary Roth | November 26, 2008, 2:54PM

With all the different programs being undertaken by the federal government to rescue the economy, it's hard to keep straight everything that taxpayers are now on the hook for.

That's especially true because the commitments are being made by several different government agencies (primarily the Treasury Department and the Federal Reserve) and even more so, because they come in a range of forms.

Some of these commitments -- for instance, the Treasury's bailout program -- represent actual spending. We could see a return on these investments, of course, depending on how the companies that we've taken on fare going forward, but there are by no means any guarantees.

Others, meanwhile, represent loans backed by collateral, meaning the government would have had to have badly miscalculated for us not to be paid back in full, probably with interest. And some are simply loan guarantees.

So putting an exact figure on exactly how much we've put up doesn't tell us much. But here's our best attempt, based on piecing together several reports, at a non-comprehensive rundown of the major components of the government's effort to stave off a financial collapse.

Spending:

- The Troubled Assets Relief Program, in which Congress allocated $700 billion to the Treasury to buy equity stakes in financial institutions.

- A Federal Reserve program, announced in October, to buy up to $2.4 trillion in commercial paper that companies use to pay bills. That figure represents what eligible issuers could sell, but the Fed has said it does not intend to buy anywhere near that amount. Earlier this week the Washington Post put the amount that it had so far put up at $266 billion.

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Eliot Spitzer

Spitzer Probe May Not Be Prime Focus Of House Inquiry, After All

Zachary Roth | November 26, 2008, 11:48AM

The news that a House committee plans to look into the events that led to that fateful investigation of Eliot Spitzer may have some observers licking their chops in anticipation of finding out whether the probe was politically motivated payback for the governor's targeting of Wall Street.

That notion has persisted, despite little concrete evidence, almost since the news of Spitzer's tryst with Ashley Dupre first surfaced in March.

But don't get too excited just yet. Steve Adamske, a spokesman for Rep. Barney Frank -- who, as chair of the House Financial Services committee, will run the inquiry -- told TPMmuckraker in an interview that in fact the effort won't be designed primarily to look at that question. Rather, said Adamske, it will focus on the somewhat drier subject of whether increased scrutiny by the Treasury Department of banking transactions, as required by the Patriot Act, is an effective counter-terrorism tool. Banks have in the past complained about the increased paperwork required by the law, arguing that in addition to being burdensome, it does little to help fight terrorism.

The Spitzer saga is the hook for an inquiry into that subject because the investigation of the governor began after his bank filed a routine report to Treasury about a series of wire transfers he made to QAT International, a shell company connected to the Emperor's Club prostitution ring. After another bank filed reports about suspicious activities by QAT International, investigators noticed the previous report about Spitzer, and began looking closer.

That focus may disappoint some committee members. Michael Capuano, a Massachusetts Democrat on the committee, seems to see the issue differently. "The question was: Why were they looking for this? Is this political retribution?" he told the New York Times.

But it's by no means clear that Frank's inquiry will answer that question.

The Daily Muck

The Daily Muck

Natalie Sherman | November 26, 2008, 10:05AM

House leaders voiced their support for the Constitution's "speech or debate clause" -- a provision designed to protect members of congress from being arrested for their legislative activities -- in a brief filed Monday in the case of outgoing Arizona GOP Rep. Rick Renzi. Renzi, who is accused of conspiracy, fraud, and money laundering, says the government collected evidence against him using an illegal wiretap order that taped conversations between him, aides, and other members of congress. He is one of a string of legislators, including Louisiana Rep. William Jefferson and Alaska Sen. Ted Stevens, to use this as defense. (CQ Politics)

Officials at the Office of Tax Revenue said that Rep. Charles Rangel (D-NY) incorrectly received a tax break on his DC home and could owe the government back revenue. The rule is designed for people who make DC their principle home, but Rangel has said his primary residence is in New York. The irregularity could complicate the House Ethics Committee investigation of allegations that the congressman received a rent break on his New York apartments. (Washington Post)

A House committee will investigate the investigation of Eliot Spitzer's post-Valentine's Day tryst with a call girl, amid speculation that the case was politically motivated and designed as revenge for Spitzer's aggressive prosecution of Wall Street executives. Meanwhile, a judge sentenced Ashley Dupre's booking agent to one year's probation. (AP)

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George Bush

Report: Bushies Who Approved Torture Likely Won't Get Pre-Emptive Pardons

Zachary Roth | November 25, 2008, 5:34PM

The White House is unlikely to grant sweeping pardons to former Bush administration officials who may have encouraged or enabled torture in approving harsh interrogation methods for terror suspects, reports the Wall Street Journal.

Some Republicans have been pushing for President Bush to grant the pardons before he leaves office. But White House officials point to opinions put out by the Justice Department that supported the administration's methods, and say that pardons -- which would no doubt draw fire from congressional Democrats and other administration critics -- are unnecessary.

It's unclear whether the incoming Obama administration intends to prosecute officials from the CIA, DOJ, and other government agencies who approved the harsh methods. A spokesperson for the Obama transition team told the Journal: "No decisions about interrogation issues will be made before the full national security and legal teams are in place."

But some congressional Democrats, as well as liberal legal scholars, have called for such prosecutions, over activities including water-boarding and the NSA's warantless wiretapping.

Justice Department

DOJ Releases Hatfill Documents

Zachary Roth | November 25, 2008, 4:19PM

The Associated Press reports:

The Justice Department has released hundreds of documents that it used to falsely accuse scientist Steven J. Hatfill of masterminding the 2001 anthrax attacks.

The documents were unsealed Tuesday following last week's federal court order to do so. They show the FBI seized clothing, financial records, VHS tapes, books and other papers from Hatfill's home in Frederick, Md.

Hatfill originally was named a person of interest in the anthrax attacks. But the Justice Department cleared him last summer after switching its focus to another suspect, Bruce Ivins.

Some of the court documents can be found here. We'll bring you the rest as soon as DOJ makes them available.

The New York Times and Los Angeles Times had sued to have the Hatfill documents released.

Late Update: Here are more of the documents.

Duke Cunningham

Petition Seeking Pardon For Cunningham Has Just 13 Signatures After Three Years

Natalie Sherman | November 25, 2008, 2:30PM

The clock's running out on the Bush administration, which leaves just 56 days for the president to wipe criminal slates clean. Former California GOP congressman Randy "Duke" Cunningham officially filed for a presidential pardon back in July, but sympathy for the man one author dubbed the "most corrupt congressman in history" appears pretty lackluster.

We noticed that there are only 13 signatures on an online petition designed to demonstrate public support for a pardon, even though it was posted nearly three years ago -- just two days after Cunningham pleaded guilty to accepting more than $2.4 million in bribes.

The 66-year-old, who has a history of prostate cancer, was later sentenced to 100 months in prison.

Fred Johnson III is listed as the organizer of the petition. Mr. Johnson did not respond to an e-mail, sent through the petition site, asking for his thoughts on Cunningham's odds. We'll settle for yours.

Bailout

Some Pushing For More Oversight Of Federal Reserve Lending

Zachary Roth | November 25, 2008, 1:15PM

Yesterday, the Washington Post and Bloomberg News both reported on the astronomical sum of money -- the Post put it at almost $900 billion -- that the Federal Reserve is quietly lending to banks and other financial institutions hit by the financial crisis.

Unlike with the $700 billion in bailout money allocated to the Treasury Department, the Fed won't reveal basic details about the program: for instance, which institutions are getting that money, how much they're getting, or which assets are being used as collateral on the loans.

Bloomberg News filed a Freedom of Information Act (FOIA) request, in order to pry loose the information, but the Fed responded that this was "confidential commercial information", reports the Post, and argued that the Federal Reserve Bank of New York, which keeps the information, is not subject to FOIA. Bloomberg has now filed a federal lawsuit against the Fed.

Some in Congress are also concerned. Several members at a hearing of the House Financial Services Committee last week expressed skepticism about the lack of transparency. And a staffer for Rep. Scott Garrett (R-NJ), a member of the House financial services committee, told TPMmuckraker that the congressman will soon send a letter to Fed Chairman Ben Bernanke asking him to provide further details about the loans.

At that same hearing, Bernanke explained the reason for the Fed's secrecy: "There's a concern that if the name is put in the newspaper that such and such bank came to the Fed to borrow overnight for a good reason, that people might begin to worry: Is this bank credit-worthy?" he said. "And that might create a stigma, a problem, and might cause banks to be unwilling to borrow."

Tim Yeager, a former economist at the Federal Reserve Bank of St. Louis, and now a professor of finance at the University of Arkansas, bolstered that view. He told TPMmuckraker that in normal times more disclosure makes sense, but that in times of crisis like this, "if word leaked out" that banks were going to the Fed to borrow money, "there could be a liquidity run."

We've made calls to the House financial services and oversight committees, and the Senate banking and finance committees, to ask whether they have plans to look into the issue further, given the amount of taxpayer money at issue. We'll let you know what we find out.

George Bush

Ex-Bush Aide Charged With Stealing Taxpayer Money

Zachary Roth | November 25, 2008, 11:16AM

A former White House aide has been charged with stealing thousands of dollars of federal money that was intended to promote democracy in Cuba, reports the Washington Examiner.

Felipe Sixto was charged with stealing from the Center for a Free Cuba, a non-profit organization, both while he worked there from 2005 to 2007, and after he went to work in the White House last year.

In March of this year, we noted that Sixto had resigned from the White House after the allegations first surfaced. He had been working there as a special assistant to the president in the office of inter-governmental affairs.

The Daily Muck

The Daily Muck

Natalie Sherman | November 25, 2008, 10:16AM

Sen. John Conyers (D-MI) and Sen. Patrick Leahy (D-VT) have written to Attorney General Michael Mukasey pressing the Justice Department on its decision to foot the bill for lawyers hired to defend former Attorney General Alberto Gonzales in a suit about politicized hiring practices. The DOJ had agreed to pay up to $24,000 per month, about twice the price of a public attorney, according to reports last week. (Politico)

Just be reasonable, a federal appeals court ruled Monday in a case about spying on American citizens abroad. The three-judge panel said the U.S. did not need warrants to conduct searches and electronic surveillance, but must meet the Fourth Amendment's requirement for reasonableness. (New York Times)

The New York Times reveals New York Democratic Rep. Charles Rangel's decision to support a tax loophole that allows companies to reduce taxes by opening offices abroad, despite his prior condemnation of it as unpatriotic. Rangel said he did not support closing the loophole because doing so would effectively impose a retroactive tax on the companies, something he opposes. Nabors Industries, which had lobbied aggressively in favor of the tax shelter, donated $1 million to a school project championed by the congressman. The two parties deny any quid pro quo. Rangel chairs the powerful Ways and Means committee and is a top fundraiser for other Democratic candidates. He faces an ethics investigation about charges that he did not disclose income drawn from real estate. (New York Times/Roll Call)

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Sheldon Adelson

Report: Pro-War Group Going Out of Business

Zachary Roth | November 24, 2008, 5:11PM

Call it a sign of the times...

It looks like Freedom's Watch, the pro-war pressure group bankrolled by casino mogul Sheldon Adelson and talked up by former White House spokesman Ari Fleischer, is wrapping up its operations -- apparently without too much to show for its efforts.

The advocacy organization is likely to permanently shut its doors at the end of the year, according to sources who spoke to the Las Vegas Review Journal.

As we noted earlier this month, Adelson has been down on his financial luck lately. His casino company Las Vegas Sands recently said it may default on debt and face bankruptcy.

The group, which advocates an open-ended commitment in Iraq and unquestioning support for Israeli hawks, spent $30 million to influence the recent congressional elections.

But spokesman Ed Patru, a former spokesman for the National Republican Campaign Committee, wouldn't say how the group's favored candidates fared. "Our focus was to impact the debate," said Patru.

In other words, it's safe to assume, not well.

Lobbyists

Wal-Mart Cans GOP Lobbyist After He's Charged in Abramoff Scheme

Zachary Roth | November 24, 2008, 3:10PM

Wal-Mart has fired James Hirni, the former Team Abramoff lobbyist who prosecutors on Friday charged with giving illegal gifts to two congressional staffers.

In a statement emailed to The Hill, a company spokesman wrote:

"Based on Mr. Hirni's [expected] guilty plea which relates to conduct occurring prior to and unrelated to his employment by the company, we terminated his employment."

Todd Boulanger, another former Abramoff team member implicated in the scheme resigned on Friday from the lobbying firm Cassidy and Associates. Boulanger has not been formally charged at this point.

Hirni had worked as Wal-Mart's "director of Republican outreach". He first represented the retail giant in 2004 while working with Abramoff at the law and lobbying firm Greenberg Traurig.

Jack Abramoff

Abramoff Lobbyists Wanted Measure Attached To Young's Transportation Bill

Zachary Roth | November 24, 2008, 12:29PM

So what did James Hirni and Todd Boulanger -- the former Team Abramoff lobbyists now in hot water for plying congressional staffers with undisclosed gifts -- want in return?

Both men were working for Abramoff at the law and lobbying firm Greenberg Traurig, on behalf of United Rentals, an equipment rental company. Court documents filed by prosecutors allege that in 2003, they wanted action on an amendment to a federal highway reauthorization bill that would have encouraged state public works agencies to rent, rather than buy, construction equipment. That would clearly have benefited United Rentals.

The documents further allege that immediately after they had paid for Blackann and another staffer (identified as Staffer D) to attend the World Series (and a "Gentleman's Club" in New York), Boulanger and Hinri sent drafts of the specific measure they wanted to Trevor Blackann, the staffer who just pleaded in connection with the scheme, and Staffer D.

Staffer D at the time worked for the House Transportation and Infrastructure Committee, which was then chaired by Rep. Don Young (R-AK). That committee was overseeing the larger highway reauthorization bill to which Boulanger and Hirni were seeking to attach their measure.

In November of that year, say the documents, Boulanger and Hirni prevailed on a Senate staffer to offer the amendment they wanted to the Senate version of the bill.

United Rentals hardly has a squeaky clean reputation. This September, it agreed to pay the SEC $14 million, ending a four-year probe into claims that the company fraudulently inflated its earnings and made fraudulent leasing transactions with suppliers, between 1997 and 2002. It did not admit or deny the charges.

Iraq

Report: NSA Listened In On Blair's Personal Calls

Zachary Roth | November 24, 2008, 11:40AM

Did U.S. intelligence listen in on the personal phone calls of Tony Blair and former Iraqi president Ghazi Al-Yawer?

That's what David Murfee Faulk, a former Arab linguist who worked at a secret NSA facility, has told ABCNews.com. Murfee Faulk says he saw and read a file on Blair's "private life" and heard "pillow talk" exchanged between Al-Yawer and his then-fiancee.

The U.S. and Britain have pledged not to collect information covertly on each other, several former intelligence officials told ABCNews.com -- though this would by no means be the first time the U.S. was found to have done so.

Last month, Murfee Faulk and another former worker at the NSA facility revealed to the news network that the agency had listened in on private calls made by American journalists, aid workers, and soldiers stationed in Iraq. A Senate panel has said it is investigating those claims.

Jack Abramoff

Another Ex-Member of Team Abramoff Charged -- And One More Could Be Next

Zachary Roth | November 24, 2008, 11:07AM

More developments in the ongoing Jack Abramoff probe...

Last week Trevor Blackann, a former staffer for Missouri Republicans Roy Blunt and Kit Bond, pleaded guilty to concealing thousands of dollars in illegal gifts he received from lobbyists who were part of Team Abramoff.

Those lobbyists were quickly identified as James Hirni, until recently a lobbyist for Wal-Mart, and Todd Boulanger, who until last week worked for Cassidy and Associates, a top DC lobby shop.

And late Friday, ABCNews.com reported that prosecutors had filed charges against Hirni, and that he's expected to plead guilty to conspiracy to commit wire fraud. Hirni's lawyer told the site that Hirni is cooperating with prosecutors, suggesting that DOJ is working to build cases against bigger fish.

As for Boulanger, he could be next to be charged: also Friday, Cassidy and Associates announced that it had "accepted the departure" of the lobbyist that afternoon.

The Daily Muck

The Daily Muck

Natalie Sherman | November 24, 2008, 10:05AM

Former California GOP congressman Randy "Duke" Cunningham and Louisiana's Democratic ex-governor Edwin W. Edwards, both convicted of corruption, are among the people seeking a presidential pardon before Bush steps down in January. Scooter Libby, whose sentencing in 2007 for perjury, obstruction of justice, and lying to investigators during the investigation of the Valerie Plame leak Bush commuted last year, is not on the list. During his eight years in office, Bush has granted only 157 pardons, just 17 more than the 140 Clinton granted during the final days of his tenure. (Washington Post)

A Washington Post report highlights the role of the Office of Thrift Supervision in the financial crisis, showing that the federal regulator "failed to rein in the destructive excesses of banks under their watch despite clear evidence of mounting problems." To date this year, banks under OTS regulation, including big names like IndyMac, Bancorp, and Washington Mutual, account for $355.7 billion in failed assets. (Washington Post)

General Motors announced Friday it would return two of its private planes, just days after auto executives got blasted for flying private jets to Washington to plead for a federal bailout. The company maintained that the decision had been made prior to the bad press. (Washington Post)

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