Beverly Hills 1/9/2010 1:22:31 AM
News / Business

New York Fed Told A.I.G. Not to Disclose Key Details in Payouts

Finance World News Update by EQUITIES Magazine

As the government handling of the American International Group Inc.’s (AIG) bailout continues to draw scrutiny and criticism for Treasury Secretary Timothy Geithner—president of the New York Fed when it first bailed out AIG in September 2008—it has been revealed that the Federal Reserve Bank of New York told AIG not to disclose key details of their agreements to make big payouts to banks in regulatory filings.

 

In a Nov. 25 email, Peter Bazos, an attorney at law firm Davis Polk & Wardwell, which represents the New York Fed, wrote that certain agreements "do not need to be filed."

 

Later, when the Securities and Exchange Commission requested more disclose, AIG amended its filings several times and provided the information. The ailing insurance company was also pressured by Congress to release the names of banks that were paid off in full on $62 billion in bets on soured mortgage securities. French Bank Société Générale and Wall Street firm Goldman Sachs Group Inc. were on the receiving end of the largest payouts, information finally made public in March 2009 revealed.

 

 

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