Cummings Demands Geithner Testify on AIG-Fed E-Mails

(I personally wouldn't mind if Geithner was fired. Too much of the fox guarding the hen house going on here.)

Jan. 8 (Bloomberg) -- Treasury Secretary Timothy Geithner should testify before Congress about efforts by the Federal Reserve Bank of New York to limit American International Group Inc.’s disclosures of payments to banks, a House Democrat said.

Representative Elijah Cummings of the Oversight and Government Reform Committee called for an investigation and hearing into what information was withheld from the public at the New York Fed’s request in 2008, when Geithner led the regulator. E-mails obtained by Congress include New York Fed requests that the bailed-out insurer withhold documents from public filings and delay disclosures about payments to banks to retire credit-default swaps, Bloomberg News reported yesterday.

“It is essential to know what knowledge or involvement now-Secretary of the Treasury Geithner had in the decisions made by New York Fed officials to exclude information” from AIG’s regulatory filings, Cummings wrote yesterday to committee Chairman Edolphus Towns, a New York Democrat. It is “critical” that Geithner testify before Congress, Cummings wrote.

The demand adds to pressure on Geithner to justify his handling of New York-based AIG’s bailout, which was $85 billion when he helped orchestrate the first rescue in 2008 and swelled to $182.3 billion. Representative Darrell Issa, a California Republican on the oversight committee, has called payments to AIG trading partners a “backdoor bailout” because banks got 100 cents on the dollar for swaps tied to subprime mortgages.

The remainder of this article can be found at:

http://www.bloomberg.com/apps/news?pid=20601087&sid=ae1mKfv9OwWI&pos=3

Another interesting article regarding this issue ("Geithner’s Fed told AIG to hide “backdoor bailout”) can be found at:

http://www.homelandstupidity.us/2010/01/07/geithners-fed-told-aig-to-hide-backdoor-bailout/