AIG

Congress To DOJ And SEC: Hand Over AIG Docs Or We'll Subpoena Them

Zachary Roth | April 28, 2009, 10:21AM

Congress is upping the ante in its bid to get access to those insider reports on AIG compiled by a government monitor.

House Oversight chair Ed Towns, joined by ranking GOPer Darrell Issa, yesterday sent letters to the Justice Department and the SEC, threatening them with subpoenas if they don't hand over the information by this Thursday*.

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AIG

Congress To Ask Liddy: "What Caused The Downfall Of AIG?"

Zachary Roth | April 27, 2009, 10:22AM

AIG CEO Ed Liddy has already testified once before Congress about his firm's starring role in the financial crisis. But it looks like he'll soon be doing so again.

Last week, Rep. Ed Towns -- who chairs the House Oversight Committee, which is probing the causes of the crisis -- sent a letter to Liddy inviting him to appear May 6th. Among the topics that Towns intends to cover, according to the letter: "What caused the downfall of AIG?" and "what has AIG done with its Federal financial assistance?"

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Bank of America

Cuomo: Paulson Kept SEC Out Of The Loop On B Of A

Zachary Roth | April 23, 2009, 12:19PM

New York Attorney General Andrew Cuomo has just released documents from his investigation into Bank of America, its receipt of government money, and those billions in bonuses that went to Merrill Lynch executives.

Here's one quick nugget we found: It looks like then-Treasury Secretary Hank Paulson didn't keep the SEC -- whose role, of course, is to protect investors -- informed on the government's intense December 2008 discussions with B of A about Merrill's losses, and possible government assistance for B of A.

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Bailout

Bailout Fraud Prosecutor Nets First Catch

Zachary Roth | April 22, 2009, 1:41PM

In an interview with The Hill published yesterday, Neil Barofsky, the inspector general for the bailout, said that he was pursuing 20 criminal and civil investigations into potential fraud in the TARP program.

And it looks like at least one has now paid off.

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Bailout

Eilzabeth Warren On Daily Show

Zachary Roth | April 16, 2009, 1:01PM

Last night, Elizabeth Warren, the Harvard Law professor who chairs the Congressional Oversight Panel for the bailout, talked to Jon Stewart on the The Daily Show.

Here's part 1:

And here's part 2:

AIG

AIG Responds On PR Expenses: We'll Give Congress What It Wants, And Then Some

Zachary Roth | April 15, 2009, 9:06AM

AIG has responded to the letter from Rep. Ed Towns requesting information about the company's PR expenses, that we first reported on yesterday -- and which has now been picked up by Reuters, Bloomberg, and ABC News, among others.

Here's the statement they sent us:

In more than 30 media appearances since the beginning of the year and elsewhere, Mr. Greenberg and his lawyers have made false and misleading statements about AIG, including his role in creating AIG Financial Products and its credit default swap business, as well as the circumstances surrounding his forced departure from AIG during an accounting fraud investigation. We look forward to providing Congressman Towns with background on why it has been necessary to correct these and other misstatements, which are both misleading to the American public and damaging to AIG and its ability to repay taxpayers.

This issue is not about AIG's corporate public relations expenditures, which are down sharply since last year. It is about correcting Mr. Greenberg's false and damaging statements.

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AIG

Congress Probing AIG Spin Shop

Zachary Roth | April 14, 2009, 12:57PM

Congress is demanding information from AIG about reports that the bailed-out insurance giant has four PR firms on its payroll -- and about its recent PR blitz aimed at discrediting former CEO Hank Greenberg.

In a letter sent this morning to AIG chief Ed Liddy and obtained exclusively by TPMmuckraker, House Oversight committee chair Ed Towns requests detailed information on AIG's PR expenses, specifically mentioning Hill & Knowlton, and Mark Penn's Burson-Marsteller, two high-priced experts in Washington spin that have signed on to represent the firm.

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Bailout

SEC Reviewing Whether B of A Broke Law On Merrill Bonuses

Zachary Roth | April 14, 2009, 11:37AM

Ever since AIG's bonus shenanigans exploded onto the national scene last month, Merrill Lynch's own outrageous payouts have kind of gotten short shrift. We've felt this was unfair to the Thundering Herd, since at an around $3.6 billion, its bonuses dwarfed those of AIG. Granted, its role in bringing down the financial system may not have been quite as central as that of AIG's financial products unit, but it's not like Merrill, which needed rescuing last fall by Bank of America, was squeaky clean. Where's the respect?

But luckily, the Merrill bonuses are back. The SEC is looking at whether Bank of America broke the law by not disclosing, in filings last year, the fact that it was planning to pay those bonuses, reports the Washington Post.

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Bailout

Conflicted Sununu: The Real Problem Is That CEO Pay Limits Are Too Tough

Zachary Roth | April 8, 2009, 3:00PM

Yesterday, the panel overseeing bailout spending on behalf of Congress issued its latest hard-hitting report, which criticized the Treasury Department's approach to the program and called for top execs at major banks to be fired.

But perhaps the most interesting thing about the report is the "alternative view" that accompanied it, from Republican panel member John Sununu.

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AIG

Warren: Fire Top Management At AIG and Citi

Zachary Roth | April 7, 2009, 5:25PM

We're late to this, but it looks like Elizabeth Warren, the Harvard Law professor who chairs the Congressional Oversight panel for the TARP funds, is upping the ante.

After several months of raising the alarm about the Treasury Department's failure to attach strings to the bailout funds, to little apparent effect, Warren will issue a hard-hitting report this week that broadly indicts the Obama administration's approach to the financial crisis, reported the British paper The Observer over the weekend.

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Bailout

Congress To Probe Geithner's "Special Purpose" Plan To Skirt Pay Caps On Bankers

Moe Tkacik | April 7, 2009, 2:53PM

Yesterday we puzzled over the mixed messages we were hearing from Obama officials over the veracity of a Washington Post report that it was using Enron-style "special purpose vehicles" to undermine executive pay restrictions on bailed out banks: senior adviser David Axelrod sheepishly defended the strategy on one Sunday talk show, while Tim Geithner denied it altogether on another. But newly-promoted House Oversight Chairman Ed Towns is getting to the bottom of it, reports the Post today, in a story that sheds some much-needed light on the conflicting stories: the strategy began with the Treasury Department's $1 trillion consumer and business lending initiative, which is in part an expansion of the Federal Reserve's Term Asset-Backed Securities Loan Facility, which is open to the American subsidiaries of foreign banks, which Treasury presumably wants to participate in the programs without having to deal with the added diplomatic headache of subjecting foreign bankers to rules designed to satisfy American voters. Unsurprisingly, not everyone in Congress is opposed to that.

A senior House aide said he agreed with the Treasury's policy and that he believed a recent vote by the House on another piece of executive compensation legislation showed that Congress did not intend the restrictions to apply to firms that did not receive direct capital injections. The aide spoke on condition of anonymity because he was not authorized to comment.

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Tim Geithner

Is The White House Helping Bailed Out Banks Skirt Pay Caps? Depends What Channel You're Watching

Moe Tkacik | April 6, 2009, 3:22PM

On Saturday the Washington Post reported that the administration was doling out federal bailout money via "special purpose vehicles" to help banks skirt restrictions on the funds imposed by Congress -- including, naturally, limitations on executive pay. In a move a former Justice Department attorney equated to "money laundering," the story further specified that the White House had concluded that the conditions ought not to apply in "at least three out of five initiatives funded by the rescue package."

The story quoted Treasury spokesman Andrew Williams defending the strategy, and on Sunday senior Obama adviser David Axelrod, despite his reported distaste for Treasury's lenience on the banks, went on Fox News Sunday and towed the Treasury line when Chris Wallace brought up the report.

But a bit later the same morning on Face the Nation the policy seemed to have changed -- if you believed Treasury Secretary Tim Geithner's unequivocal denial to CBS's Bob Schieffer that any such plan compensation-restriction avoidance plan existed:

Transcripts after the jump:

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AIG

AIG's PR Blitz

Zachary Roth | April 3, 2009, 1:53PM

So as we reported yesterday, longtime AIG CEO Hank Greenberg went before Congress and placed the blame for the firm's collapse squarely on the execs who took over after he left in 2005 -- including on the crew currently at the helm, who Greeenberg said should be replaced.

But we've been struck by the ferocity of AIG's response to Greenberg, who's been skirmishing with the firm pretty much since he stepped down. Despite its awkward position as a ward of the state -- not to mention as the prime corporate face of the greed and recklessness that caused the financial crisis -- AIG has mounted an aggressive public-relations counter-offensive.

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AIG

Greenberg: Get Rid Of AIG Management

Zachary Roth | April 2, 2009, 2:19PM

More nuggets of news from Hank Greenberg's testimony before Congress....

Greenberg, with the prominent Washington lawyer David Boies at his side, declared that government efforts to rescue AIG -- taxpayers now own almost 80 percent of the insurance giant -- have failed. He said that that stake should be reduced to 15 percent, and that the company should be restructured, and current management should be removed.

Greenberg has been embroiled in legal wrangling with AIG almost since his 2005 departure from the firm, amid allegations of accounting improprieties.

He also quarreled with AIG's decision, apparently blessed by the government, to pay back in full its counter-parties on the credit default swaps.

It would have been more beneficial for the American taxpayer if the federal government had walled off AIG Financial Products...and provided guarantees to AIGFP's counterparties rather than putting up billions of dollars in cash collateral to those counterparties.

And asked by Rep. Rep. Elijah Cummings whether he took any responsibility for the firm's collapse, Greenberg replied flatly: "No I don't."

AIG

Greenberg To Taxpayers: Drop Dead

Zachary Roth | April 2, 2009, 11:43AM

Nice guy, that Hank Greenberg.

Here, Rep. Jason Chaffetz (R-UT) asks the former AIG CEO whether he'd be willing to use a separate company that Greenberg has stocks in to pay back taxpayers for AIG's bailout.

And Greenberg pretty much tells him to shove it.

Watch: