Senate Republicans block Obama's nominee to head consumer watchdog agency
Washington Post
Dec. 8, 2011
In a long-awaited vote Thursday morning, Senate Republicans blocked the confirmation of President Obama’s nominee to lead his signature consumer watchdog agency, a move that prevents it from exercising many of its broad new powers.
Republicans relied on a procedural vote to keep the Senate from even considering former Ohio attorney general Richard Cordray for the top job at the Consumer Financial Protection Bureau.
Though GOP lawmakers have praised Cordray’s qualifications for the job -- he currently serves as the CFPB’s director of enforcement -- they have pledged to prevent any candidate from being confirmed unless significant structural change are made to the bureau.
Read more at:
http://www.washingtonpost.com/blogs/2chambers/post/senate-republicans-block-cordray-as-obama-consumer-watchdog-nominee/2011/12/08/gIQA6j9BfO_blog.html
Thursday, December 8, 2011
Saturday, December 3, 2011
Citigroup and the people who brought the financial meltdown
Citigroup to Pay Millions to Close Fraud Complaint
By EDWARD WYATT
New York Times
October 19, 2011
WASHINGTON — As the housing market began its collapse, Wall Street firms and sophisticated investors searched for ways to profit. Some of them found an easy method: Stuff a portfolio with risky mortgage-related investments, sell it to unsuspecting customers and bet against it.
Citigroup on Wednesday agreed to pay $285 million to settle a civil complaint by the Securities and Exchange Commission that it had defrauded investors who bought just such a deal. The transaction involved a $1 billion portfolio of mortgage-related investments, many of which were handpicked for the portfolio by Citigroup without telling investors of its role or that it had made bets that the investments would fall in value.
In the four years since the housing market began its steady descent, securities regulators have settled only two cases related to the financial crisis for a larger sum of money. This is also the third case brought by the S.E.C. accusing a major Wall Street institution of misleading customers about who was putting together a security and about their motive. Goldman Sachs and JPMorgan Chase & Company both settled similar cases last year.
The settlement will refund investors with interest and include a $95 million fine — a relative pittance for a giant like Citigroup. On Monday, the company reported that in the third quarter alone it earned profits of $3.8 billion on revenue of $20.8 billion. The settlement may also have trouble getting approval from Jed S. Rakoff, the federal district judge in New York who must ultimately sign off on the fine and who has taken a hard line on S.E.C. settlements.
Neither the S.E.C. nor the Justice Department would say whether the case raised questions about whether Citigroup had been involved in any criminal wrongdoing. But the case highlights a growing frustration felt by foreclosed homeowners, investors and Wall Street protesters alike that few, if any, senior banking executives have faced criminal charges for losses growing out of the financial crisis.
Citigroup has settled one case stemming from the crisis. Last year, it agreed to pay $75 million to settle federal claims that it hid from investors vast holdings of subprime mortgage investments that were losing value during the crisis and that ultimately prompted the federal government to rescue the bank.
“The securities laws demand that investors receive more care and candor than Citigroup provided” to investors in the security, said Robert Khuzami, director of the S.E.C.’s enforcement division, referring to Wednesday’s action. “Investors were not informed that Citigroup had decided to bet against them and had helped to choose the assets that would determine who won or lost.”
The complex amalgamation of investments known as Class V Funding III produced $126 million in profits for Citigroup’s brokerage subsidiary, and another $34 million in fees for putting it together. All of that, including interest and the $95 million fine, will now be going back to the investors; the government will not receive anything.
In a statement, Citigroup noted that the S.E.C. did not charge it with “intentional or reckless misconduct.” Rather, it settled charges that its actions were negligent and misleading to investors. Despite its profits on the current deal, over all Citigroup lost tens of billions of dollars on its holdings of mortgage-related investments.
“We are pleased to put this matter behind us and are focused on contributing to the economic recovery, serving our clients and growing responsibly,” the company said in a statement. “Since the crisis, we have bolstered our financial strength, overhauled the risk management function, significantly reduced risk on the balance sheet and returned to the basics of banking.”
The S.E.C. on Wednesday also brought a case against Credit Suisse, which played a smaller role in the transaction, and against one individual at each company. But those individuals were midlevel employees in each company’s investment and trading departments; no senior executives at either company were charged...
By EDWARD WYATT
New York Times
October 19, 2011
WASHINGTON — As the housing market began its collapse, Wall Street firms and sophisticated investors searched for ways to profit. Some of them found an easy method: Stuff a portfolio with risky mortgage-related investments, sell it to unsuspecting customers and bet against it.
Citigroup on Wednesday agreed to pay $285 million to settle a civil complaint by the Securities and Exchange Commission that it had defrauded investors who bought just such a deal. The transaction involved a $1 billion portfolio of mortgage-related investments, many of which were handpicked for the portfolio by Citigroup without telling investors of its role or that it had made bets that the investments would fall in value.
In the four years since the housing market began its steady descent, securities regulators have settled only two cases related to the financial crisis for a larger sum of money. This is also the third case brought by the S.E.C. accusing a major Wall Street institution of misleading customers about who was putting together a security and about their motive. Goldman Sachs and JPMorgan Chase & Company both settled similar cases last year.
The settlement will refund investors with interest and include a $95 million fine — a relative pittance for a giant like Citigroup. On Monday, the company reported that in the third quarter alone it earned profits of $3.8 billion on revenue of $20.8 billion. The settlement may also have trouble getting approval from Jed S. Rakoff, the federal district judge in New York who must ultimately sign off on the fine and who has taken a hard line on S.E.C. settlements.
Neither the S.E.C. nor the Justice Department would say whether the case raised questions about whether Citigroup had been involved in any criminal wrongdoing. But the case highlights a growing frustration felt by foreclosed homeowners, investors and Wall Street protesters alike that few, if any, senior banking executives have faced criminal charges for losses growing out of the financial crisis.
Citigroup has settled one case stemming from the crisis. Last year, it agreed to pay $75 million to settle federal claims that it hid from investors vast holdings of subprime mortgage investments that were losing value during the crisis and that ultimately prompted the federal government to rescue the bank.
“The securities laws demand that investors receive more care and candor than Citigroup provided” to investors in the security, said Robert Khuzami, director of the S.E.C.’s enforcement division, referring to Wednesday’s action. “Investors were not informed that Citigroup had decided to bet against them and had helped to choose the assets that would determine who won or lost.”
The complex amalgamation of investments known as Class V Funding III produced $126 million in profits for Citigroup’s brokerage subsidiary, and another $34 million in fees for putting it together. All of that, including interest and the $95 million fine, will now be going back to the investors; the government will not receive anything.
In a statement, Citigroup noted that the S.E.C. did not charge it with “intentional or reckless misconduct.” Rather, it settled charges that its actions were negligent and misleading to investors. Despite its profits on the current deal, over all Citigroup lost tens of billions of dollars on its holdings of mortgage-related investments.
“We are pleased to put this matter behind us and are focused on contributing to the economic recovery, serving our clients and growing responsibly,” the company said in a statement. “Since the crisis, we have bolstered our financial strength, overhauled the risk management function, significantly reduced risk on the balance sheet and returned to the basics of banking.”
The S.E.C. on Wednesday also brought a case against Credit Suisse, which played a smaller role in the transaction, and against one individual at each company. But those individuals were midlevel employees in each company’s investment and trading departments; no senior executives at either company were charged...
Friday, November 11, 2011
At last, the SEC shows more respect to Markopolos (terrific name, right?) than to Bernie Madoff
Seven SEC employees disciplined on failure to stop Madoff fraud
By David S. Hilzenrath
November 11, 2011
The Securities and Exchange Commission, which failed to stop Bernard Madoff’s long-running investment fraud despite repeated warnings, has disciplined seven agency employees over their handling of the matter but did not fire anyone, a person familiar with the actions said.
An eighth employee resigned before disciplinary action was taken, the person said.
The SEC’s head of human resources had recommended that SEC Chairman Mary L. Schapiro fire one individual, according to a second person, an official involved in the process. The human resources head took that position after a law firm hired by the SEC to advise it on the disciplinary actions also recommended that the employee be fired, the official said.
The law firm, Fortney & Scott, “recommended formal disciplinary action, including removal from service,” for an assistant regional director at the SEC, the agency’s inspector general said in an August report.
The punishments given the employees varied and included suspensions, pay cuts and demotions, according to the first person familiar with the matter. An employee who received one of the most severe sanctions got a 30-day suspension and a demotion. Another was given a pay cut of about 6 percent. At the low end, one employee was suspended for seven days, another for three days and yet another was issued a “counseling memo,” which is a step below a reprimand.
The SEC’s disciplinary process with respect to the Madoff matter was concluded months ago, SEC spokesman John Nester said Friday. He had no other immediate comment.
When the law firm advising the SEC recommended that an employee be fired, it included a qualifier, the second person familiar with the matter said. If the SEC thought it was important to avoid losing that individual’s services, it could consider a different punishment.
The people who spoke about the disciplinary process did so on condition of anonymity. One cited the sensitivity of the information and the other was not authorized to discuss it.
Madoff’s fraud cost investors billions of dollars, shattered lives, and became perhaps the biggest embarrassment in the SEC’s history. After Madoff’s house of cards collapsed in 2008, a financial sleuth named Harry Markopolos became famous for having tried in vain to get SEC employees to see through the scam...
By David S. Hilzenrath
November 11, 2011
The Securities and Exchange Commission, which failed to stop Bernard Madoff’s long-running investment fraud despite repeated warnings, has disciplined seven agency employees over their handling of the matter but did not fire anyone, a person familiar with the actions said.
An eighth employee resigned before disciplinary action was taken, the person said.
The SEC’s head of human resources had recommended that SEC Chairman Mary L. Schapiro fire one individual, according to a second person, an official involved in the process. The human resources head took that position after a law firm hired by the SEC to advise it on the disciplinary actions also recommended that the employee be fired, the official said.
The law firm, Fortney & Scott, “recommended formal disciplinary action, including removal from service,” for an assistant regional director at the SEC, the agency’s inspector general said in an August report.
The punishments given the employees varied and included suspensions, pay cuts and demotions, according to the first person familiar with the matter. An employee who received one of the most severe sanctions got a 30-day suspension and a demotion. Another was given a pay cut of about 6 percent. At the low end, one employee was suspended for seven days, another for three days and yet another was issued a “counseling memo,” which is a step below a reprimand.
The SEC’s disciplinary process with respect to the Madoff matter was concluded months ago, SEC spokesman John Nester said Friday. He had no other immediate comment.
When the law firm advising the SEC recommended that an employee be fired, it included a qualifier, the second person familiar with the matter said. If the SEC thought it was important to avoid losing that individual’s services, it could consider a different punishment.
The people who spoke about the disciplinary process did so on condition of anonymity. One cited the sensitivity of the information and the other was not authorized to discuss it.
Madoff’s fraud cost investors billions of dollars, shattered lives, and became perhaps the biggest embarrassment in the SEC’s history. After Madoff’s house of cards collapsed in 2008, a financial sleuth named Harry Markopolos became famous for having tried in vain to get SEC employees to see through the scam...
Saturday, August 27, 2011
Darrell Issa’s personal Goldman rep arranged Elizabeth Warren perjury showdown
Darrell Issa’s personal Goldman rep arranged Elizabeth Warren perjury showdown
Lucas O’Connor
Courage Campaing
August 26, 2011
There are more and more wrinkles in the troubling saga of the former Goldman Sachs VP hired by Issa to protect Goldman Sachs and other Wall Street firms from accountability on the Hill. It now looks as though he was also personally responsible for the scheduling disagreement between Elizabeth Warren and Rep. Patrick McHenry that quickly mushroomed into a debacle of McHenry twice accusing Warren of perjury.
Goldman Sachs has dropped millions on lobbying Congress and now it looks like they've gotten themselves a mole as well, courtesy of Darrell Issa. Issa and McHenry, of course, have themselves been the beneficiaries of generous campaign donations from giant financial firms throughout their careers.
~ While on that subject, the Goldman exec in question claimed last week that he had change his name to honor his family's Transylvanian heritage. Submitted with nothing but amazement, it appears that heritage is about service to an Hungarian fascit military dictator who was an early ally of Hitler's regime in Germany. So... there's that.
~ Some credit where it's due -- Issa has been ahead of the curve on government giving up. Back in January, he proposed not just ending the HAMP program designed to help struggling homeowners, but replacing it with nothing. His plan was to just spend the money instead on... well... nothing. Now it looks like $30 billion originally earmarked for foreclosure relief will be spent on nothing, because congressional Republicans aren't interested in rerouting the money.
~ New numbers show that in the last few years, private companies have seen record profits per employee, indicating that these businesses can but are not hiring. The profit rate has spiked 12% during the same period that Darrell Issa and others have continued insisting that supply-side economic policies of giving more money to private companies would spur job growth...
Monday, August 22, 2011
Darrell Issa (R-Goldman Sachs): Most of the time, when wealthy people are elected to office, they put their investments into a blind trust
Darrell Issa (R-Goldman Sachs)
Courage Campaign
Rick Jacobs
Most of the time, when wealthy people are elected to office, they put their investments into a blind trust to avoid conflicts of interest.
But Rep. Darrell Issa -- one of the richest people in America -- didn't do that. He still personally manages hundreds of millions of dollars, and it seems to drive a lot of his official decisions.
Tell Issa to focus on his full time job as a congressman, not on managing his money. Put your money in a blind trust or resign from Congress.
A new report finds that Darrell Issa hired a Goldman Sachs Vice President to run interference on new Wall Street regulations... but only after he changed his name. It's the latest in Issa's long string of conflicts of interest and corporate favoritism, a list that's gotten so long that the New York Times put the problem on the front page this week.
We already know that Issa-as-Chairman is bad news. He asked corporate lobbyists and industry groups to set his committee's agenda, cancelled a hearing when facts didn't fit his narrative, and still won't disclose what lobbyists he meets with. He's steered earmarks to fund improvements around his investment properties, and he's a big fan of South Carolina's taxpayer-funded $900 million corporate handout -- in exchange for the corporation's promise to cut employee wages and benefits.
Stop insulting your constituents and America. Stop spending your spare time looking for personal investment opportunities in his laws and Oversight investigations. The credibility of his committee -- and Issa himself -- requires that he move his money to blind trust now.
Issa has spent his entire life trying to play by special rules, and that hasn't changed just because he has more power now. This week, we've seen once again that so long as Issa is trying to legislate and turn a profit at the same time, he just isn't able to keep them separate. And that's a huge problem.
It's high time that Darrell Issa get focused on responsible oversight and assure us that he isn't still trying to work angles for his own benefit.
Thursday, July 14, 2011
Financial Crisis Panel Commissioners Leaked Confidential Information To Lobbyists, Report Alleges
Financial Crisis Panel Commissioners Leaked Confidential Information To Lobbyists, Report Alleges
7/13/11
Shahien Nasiripour
Huffpost
Republican commissioners on the panel created by Congress to probe the roots of the financial crisis leaked documents to partisan allies and shared confidential information with influence peddlers, according to a Wednesday report by Democrats on a Congressional oversight committee.
The House Oversight and Government Reform Committee, led by Republican Rep. Darrell Issa of California, sought to investigate allegations that the bipartisan Financial Crisis Inquiry Commission was mismanaged by its Democratic majority, misused taxpayer funds, was compromised by conflicts of interest and colluded with Democrats in Congress as they sought to pass a financial reform bill.
Instead, the 400,000 emails and documents obtained by the investigative committee show that Republican commissioner Peter Wallison broke confidentiality rules by leaking documents to Ed Pinto, a colleague of his at the American Enterprise Institute, a prominent right-leaning Washington-based research and policy organization.
The misconduct did not stop there, according to the report. The assistant of Bill Thomas, the panel's vice chairman and another of the four Republican commissioners, shared information about the commission's hearings, targets and investigative direction with one of Thomas's colleagues at law firm Buchanan, Ingersoll, and Rooney, one of Washington's top lobbying shops. In one case, Thomas's colleague, Alex Brill, asked Thomas's assistant in a March 31, 2010, email about an upcoming hearing on Citigroup for his "friend who represents Citi." The bank was concerned it would be unfairly singled out at its hearing, wrote Brill, who is also the chief executive of economic and political consulting firm Matrix Global Advisors.
The partisan bent of the report, its findings and the investigation that led to it lends credence to the central criticisms that have long dogged the panel: A commission led by former politicians rather than prosecutors and economists would never get to the bottom of the financial crisis, and its findings would inevitably be viewed as a political report rather than as an objective look at the companies, policies and practices that caused the most punishing downturn since the Great Depression.
The House oversight committee was to hold a hearing Wednesday on the crisis commission. It was postponed to a future undetermined date, the crisis commission's former chairman, Phil Angelides, said in an email. Thomas and Brill did not immediately respond to requests seeking comment.
Wallison violated the commission's ethics rules by leaking confidential information to Pinto on "several" occasions, the report alleges.
In one case, the crisis commission's general counsel concluded that Wallison violated the ethics code by sharing a confidential staff memo with Pinto that used private housing data provided by the Federal Reserve under a confidentiality agreement between the commission and the Fed. Wallison and Pinto both pointed to government housing policies as the primary cause of the financial crisis, a position rejected by the broader committee.
Wallison acknowledged that he supplied Pinto with the confidential staff memo, but said he didn't know it was confidential at the time.
He also said that Pinto deserved to see the memo anyway, as the data its conclusions were based on directly challenged Pinto's data and his claim that the crisis was largely caused by government homeowners policies and subprime lending by mortgage giants Fannie Mae and Freddie Mac.
"I get this memo criticizing Pinto's data -- what was I supposed to do?" Wallison said. "Pinto should be the one to respond to criticism of his data."
Pinto said Wallison sent him the FCIC memo with a simple question: "What do you think?"
Both men maintain that Fannie and Freddie's subprime mortgage activities directly led to the crisis, despite an avalanche of data that has led government and university economists to conclude otherwise.
Perhaps more distressing to the House oversight committee's Democratic staff was the unauthorized disclosure of information about the crisis commission's investigations to Brill, a Washington influence peddler who once worked as a senior adviser to Thomas when he led the House Ways and Means Committee.
Thomas's assistant, who wasn't named in the Democratic report, shared with Brill internal draft reports; information about internal commission deliberations; plans to investigate foreign banks; and the commission planned treatment of certain companies under investigation, according to internal emails obtained by the House oversight committee.
The committee noted that it could not find any record of Brill working for the crisis commission in an official or advisory capacity. The committee also could not find any record of Brill signing a confidentiality agreement, a requirement of commission employment.
In one instance, Thomas's assistant emailed Brill a draft of a then-confidential staff report on Wells Fargo's 2008 acquisition of Wachovia, a teetering, giant bank that was being battered by turmoil in the financial markets. The assistant also shared information about the crisis commission's possible witness list for its hearing on the issue.
In a response, Brill made a number of suggestions he hoped the assistant would share with Thomas.
In another instance, Brill asked the assistant about the commission's plans to probe foreign banks.
Thomas's assistant not only said the commission was going to investigate these institutions in his reply, but he named them as well, identifying Deutsche Bank, UBS, BNP Paribas, RBS and Lazard Freres as institutions the commission was probing "for various purposes."
In March 2010, Brill asked the assistant about the crisis commission's plans for its upcoming hearing on Citigroup. Brill states on his firm's website that he's helped a "Wall Street investment bank" navigate policy matters in Washington.
"Fyi, just heard from my friend who represents Citi," Brill wrote in an email. "I guess Citi feels afraid that they will be painted as one of the worst offenders of subprime when really they think that they only dabbled in subprime. I don't know the truth in any of this but I guess the titles of the panels make this look like citi is the subprime devil while WMT [Thomas] was explaining to me that Citi is a great target to study because they did a bit of everything and that is more true for Citi than for anyone else. Any thoughts?"
Later that same day, Thomas's assistant replied to Brill, explaining how the commission would likely treat Citigroup officials during their hearing.
"They aren't going to be painted as a particularly bad offender of subprime origination, because they weren't a bad offender in that area," the assistant wrote. "However, they ended up taking $55B in losses associated with subprime and then got $45B in TARP and a government guarantee on $300B of assets. And their risk management re: their subprime exposure was, by any account, pretty awful. And, it is true that they are a good example because they did a little of everything, which means that we can discuss the entire subprime-universe during their hearing. So, while I don't think they will come across as the person who as ripping off the American public, I think they may come across as a pretty poorly managed company."
It's unclear whether Brill passed on this information to any clients or Citigroup representatives, the House oversight report notes.
In an Aug 2010 email to Angelides, the crisis panel's general counsel explained how such unauthorized disclosures could impede the commission's investigation, and open it up to legal liability.
"Disclosure of commission confidential information will gravely impair the commission's ability to conduct its business in the future by making it hard to secure the cooperation of other information providers in accessing their confidential information," he wrote. "And could expose the commission to damage claims for the improper release thereof."
7/13/11
Shahien Nasiripour
Huffpost
Republican commissioners on the panel created by Congress to probe the roots of the financial crisis leaked documents to partisan allies and shared confidential information with influence peddlers, according to a Wednesday report by Democrats on a Congressional oversight committee.
The House Oversight and Government Reform Committee, led by Republican Rep. Darrell Issa of California, sought to investigate allegations that the bipartisan Financial Crisis Inquiry Commission was mismanaged by its Democratic majority, misused taxpayer funds, was compromised by conflicts of interest and colluded with Democrats in Congress as they sought to pass a financial reform bill.
Instead, the 400,000 emails and documents obtained by the investigative committee show that Republican commissioner Peter Wallison broke confidentiality rules by leaking documents to Ed Pinto, a colleague of his at the American Enterprise Institute, a prominent right-leaning Washington-based research and policy organization.
The misconduct did not stop there, according to the report. The assistant of Bill Thomas, the panel's vice chairman and another of the four Republican commissioners, shared information about the commission's hearings, targets and investigative direction with one of Thomas's colleagues at law firm Buchanan, Ingersoll, and Rooney, one of Washington's top lobbying shops. In one case, Thomas's colleague, Alex Brill, asked Thomas's assistant in a March 31, 2010, email about an upcoming hearing on Citigroup for his "friend who represents Citi." The bank was concerned it would be unfairly singled out at its hearing, wrote Brill, who is also the chief executive of economic and political consulting firm Matrix Global Advisors.
The partisan bent of the report, its findings and the investigation that led to it lends credence to the central criticisms that have long dogged the panel: A commission led by former politicians rather than prosecutors and economists would never get to the bottom of the financial crisis, and its findings would inevitably be viewed as a political report rather than as an objective look at the companies, policies and practices that caused the most punishing downturn since the Great Depression.
The House oversight committee was to hold a hearing Wednesday on the crisis commission. It was postponed to a future undetermined date, the crisis commission's former chairman, Phil Angelides, said in an email. Thomas and Brill did not immediately respond to requests seeking comment.
Wallison violated the commission's ethics rules by leaking confidential information to Pinto on "several" occasions, the report alleges.
In one case, the crisis commission's general counsel concluded that Wallison violated the ethics code by sharing a confidential staff memo with Pinto that used private housing data provided by the Federal Reserve under a confidentiality agreement between the commission and the Fed. Wallison and Pinto both pointed to government housing policies as the primary cause of the financial crisis, a position rejected by the broader committee.
Wallison acknowledged that he supplied Pinto with the confidential staff memo, but said he didn't know it was confidential at the time.
He also said that Pinto deserved to see the memo anyway, as the data its conclusions were based on directly challenged Pinto's data and his claim that the crisis was largely caused by government homeowners policies and subprime lending by mortgage giants Fannie Mae and Freddie Mac.
"I get this memo criticizing Pinto's data -- what was I supposed to do?" Wallison said. "Pinto should be the one to respond to criticism of his data."
Pinto said Wallison sent him the FCIC memo with a simple question: "What do you think?"
Both men maintain that Fannie and Freddie's subprime mortgage activities directly led to the crisis, despite an avalanche of data that has led government and university economists to conclude otherwise.
Perhaps more distressing to the House oversight committee's Democratic staff was the unauthorized disclosure of information about the crisis commission's investigations to Brill, a Washington influence peddler who once worked as a senior adviser to Thomas when he led the House Ways and Means Committee.
Thomas's assistant, who wasn't named in the Democratic report, shared with Brill internal draft reports; information about internal commission deliberations; plans to investigate foreign banks; and the commission planned treatment of certain companies under investigation, according to internal emails obtained by the House oversight committee.
The committee noted that it could not find any record of Brill working for the crisis commission in an official or advisory capacity. The committee also could not find any record of Brill signing a confidentiality agreement, a requirement of commission employment.
In one instance, Thomas's assistant emailed Brill a draft of a then-confidential staff report on Wells Fargo's 2008 acquisition of Wachovia, a teetering, giant bank that was being battered by turmoil in the financial markets. The assistant also shared information about the crisis commission's possible witness list for its hearing on the issue.
In a response, Brill made a number of suggestions he hoped the assistant would share with Thomas.
In another instance, Brill asked the assistant about the commission's plans to probe foreign banks.
Thomas's assistant not only said the commission was going to investigate these institutions in his reply, but he named them as well, identifying Deutsche Bank, UBS, BNP Paribas, RBS and Lazard Freres as institutions the commission was probing "for various purposes."
In March 2010, Brill asked the assistant about the crisis commission's plans for its upcoming hearing on Citigroup. Brill states on his firm's website that he's helped a "Wall Street investment bank" navigate policy matters in Washington.
"Fyi, just heard from my friend who represents Citi," Brill wrote in an email. "I guess Citi feels afraid that they will be painted as one of the worst offenders of subprime when really they think that they only dabbled in subprime. I don't know the truth in any of this but I guess the titles of the panels make this look like citi is the subprime devil while WMT [Thomas] was explaining to me that Citi is a great target to study because they did a bit of everything and that is more true for Citi than for anyone else. Any thoughts?"
Later that same day, Thomas's assistant replied to Brill, explaining how the commission would likely treat Citigroup officials during their hearing.
"They aren't going to be painted as a particularly bad offender of subprime origination, because they weren't a bad offender in that area," the assistant wrote. "However, they ended up taking $55B in losses associated with subprime and then got $45B in TARP and a government guarantee on $300B of assets. And their risk management re: their subprime exposure was, by any account, pretty awful. And, it is true that they are a good example because they did a little of everything, which means that we can discuss the entire subprime-universe during their hearing. So, while I don't think they will come across as the person who as ripping off the American public, I think they may come across as a pretty poorly managed company."
It's unclear whether Brill passed on this information to any clients or Citigroup representatives, the House oversight report notes.
In an Aug 2010 email to Angelides, the crisis panel's general counsel explained how such unauthorized disclosures could impede the commission's investigation, and open it up to legal liability.
"Disclosure of commission confidential information will gravely impair the commission's ability to conduct its business in the future by making it hard to secure the cooperation of other information providers in accessing their confidential information," he wrote. "And could expose the commission to damage claims for the improper release thereof."
Saturday, July 2, 2011
Duncan Hunter Aide Protected by Firm Formerly Known as Blackwater
Duncan Hunter Aide Protected by Firm Formerly Known as Blackwater
By Matt Potter
San Diego Reader
June 29, 2011
A top aide to GOP congressman Duncan Hunter headed for Africa this spring on a trip paid for by the International Republican Institute, whose board, chairehttp://www.blogger.com/img/blank.gifd by Arizona senator John McCain, includes such other Republican stalwarts as Senator Lindsey Graham and Brent Scowcroft, a key national security advisor in the administrations of Nixon, Ford, and both Bushes. Victoria Middleton, Hunter’s chief of staff, received travel expenses of $7999.98, including business class airfare, lodging of $901.21, and meals of $340.55, to be an election observer in Lagos and Abuja, Nigeria, from April 11 through April 18.
According to Middleton’s travel report, the institute “has observed every election in Nigeria since they ended military rule.” Her observation team was housed at the Transcorp Hilton Abuja at a rate of “$376 per night or less.” One reason for choosing the Hilton, the report says, is that “It has very few instances of food poisoning and otherwise meets international health standards.”
The government-funded institute, closely linked to the Republican Party, is controversial in some quarters for its ties to the Central Intelligence Agency and Blackwater USA (now known as Xe). According to an account last year in Norfolk’s Virginian-Pilot, Blackwater had a five-year, no-bid contract to protect the institute’s operations in Iraq. Internal Revenue Service filings by the institute showed that it paid Blackwater $50 million, more than a fifth of the institute’s budget, over a three-year period between October 2005 and September 2008, according to the paper. Eight “democracy building” grants from the State Department to the institute have totaled $131 million since 2004, the paper added.
According to Middleton’s itinerary, upon its arrival in Abuja her delegation received a “Security Overview” from Greystone, which the New York Times reported last September was among 30 “shell companies” that Blackwater set up after the firm ran into controversy in Iraq.
Comments
I am a spokesperson for the International Republican Institute. IRI has no ties to the CIA. Those are conspiracy theories made-up by dictators who will do anything to hold on to power and others who are threatened by real democracy. IRI takes seriously the security of its staff and the volunteers who travel with the Institute. I can’t imagine the outcry if IRI abdicated its responsibility for security and as a result a volunteer was killed. You can learn about IRI at www.iri.org.>
By lgates 9:21 a.m., Jun 29, 2011
I'd feel a lot better if the "International Republican Institute" were more connected to the Central Intelligence Agency than to Blackwater, Xe or Greystone -- those now-notorious private firms made up of unaccountable soldiers of fortune who shoot up Iraqi civilians and answer to no civil authority.
By Matt Potter
San Diego Reader
June 29, 2011
A top aide to GOP congressman Duncan Hunter headed for Africa this spring on a trip paid for by the International Republican Institute, whose board, chairehttp://www.blogger.com/img/blank.gifd by Arizona senator John McCain, includes such other Republican stalwarts as Senator Lindsey Graham and Brent Scowcroft, a key national security advisor in the administrations of Nixon, Ford, and both Bushes. Victoria Middleton, Hunter’s chief of staff, received travel expenses of $7999.98, including business class airfare, lodging of $901.21, and meals of $340.55, to be an election observer in Lagos and Abuja, Nigeria, from April 11 through April 18.
According to Middleton’s travel report, the institute “has observed every election in Nigeria since they ended military rule.” Her observation team was housed at the Transcorp Hilton Abuja at a rate of “$376 per night or less.” One reason for choosing the Hilton, the report says, is that “It has very few instances of food poisoning and otherwise meets international health standards.”
The government-funded institute, closely linked to the Republican Party, is controversial in some quarters for its ties to the Central Intelligence Agency and Blackwater USA (now known as Xe). According to an account last year in Norfolk’s Virginian-Pilot, Blackwater had a five-year, no-bid contract to protect the institute’s operations in Iraq. Internal Revenue Service filings by the institute showed that it paid Blackwater $50 million, more than a fifth of the institute’s budget, over a three-year period between October 2005 and September 2008, according to the paper. Eight “democracy building” grants from the State Department to the institute have totaled $131 million since 2004, the paper added.
According to Middleton’s itinerary, upon its arrival in Abuja her delegation received a “Security Overview” from Greystone, which the New York Times reported last September was among 30 “shell companies” that Blackwater set up after the firm ran into controversy in Iraq.
Comments
I am a spokesperson for the International Republican Institute. IRI has no ties to the CIA. Those are conspiracy theories made-up by dictators who will do anything to hold on to power and others who are threatened by real democracy. IRI takes seriously the security of its staff and the volunteers who travel with the Institute. I can’t imagine the outcry if IRI abdicated its responsibility for security and as a result a volunteer was killed. You can learn about IRI at www.iri.org.>
By lgates 9:21 a.m., Jun 29, 2011
I'd feel a lot better if the "International Republican Institute" were more connected to the Central Intelligence Agency than to Blackwater, Xe or Greystone -- those now-notorious private firms made up of unaccountable soldiers of fortune who shoot up Iraqi civilians and answer to no civil authority.
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