COVER-UP: New York Fed Officials Pressured The SEC To Grant 'NATIONAL SECURITY' Status To Hide AIG's $62 Billion Gift To Banks

The AIG cover-up unravels.  More from our look back at AIG, Geithner and Goldman.

• Stephen Friedman was never charged by the SEC

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Reuters

NEW YORK - U.S. securities regulators originally treated the New York Federal Reserve's bid to keep secret many of the details of the American International Group bailout like a request to protect matters of national security, according to emails obtained by Reuters.

The request to keep the details secret were made by the New York Federal Reserve -- a regulator that helped orchestrate the bailout -- and by the giant insurer itself, according to the emails.

The emails from early last year reveal that officials at the New York Fed were only comfortable with AIG submitting a critical bailout-related document to the U.S. Securities and Exchange Commission after getting assurances from the regulatory agency that "special security procedures" would be used to handle the document.

The SEC, according to an email sent by a New York Fed lawyer on January 13, 2009, agreed to limit the number of SEC employees who would review the document to just two and keep the document locked in a safe while the SEC considered AIG's confidentiality request.

The SEC had also agreed that if it determined the document should not be made public, it would be stored "in a special area where national security related files are kept," the lawyer wrote.

In another email, a New York Fed official said the SEC suggested in late December 2008, that AIG file the document under seal and then apply to the regulatory agency for so-called confidential treatment, if central bankers wanted to stop the information from becoming public.

The emails were included in the mountain of documents the New York Fed turned over last week to the House Committee on Oversight and Government Reform, which will hold a hearing Wednesday into the AIG bailout and the New York Fed's role in trying keep the specific terms of that Fed-engineered rescue in November 2008, from being made public.

"The New York Fed was orchestrating what can only be characterized as an extreme effort to ensure that details of the counterparty deal stayed secret," Rep. Darrell Issa from California, the ranking Republican on the House Oversight Committee, said through a spokesman.  "More and more it looks as if they would've kept the details of the deal secret indefinitely, it they could have."

There's quite a bit more to this story at Reuters.

Continue reading...

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Hank Greenberg with Maria Bartiromo on Goldman's role in the AIG bailout...

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[DailyBail]

Who Taught Sarah Palin How To Spell Bernanke?

http://dailybail.com/home/who-taught-sarah-palin-how-to-spell-bernanke.html

[DailyBail]

The Fed has finally come clean. It now admits it bailed out Bear Stearns -- taking on tens of billions of dollars of the bank's bad loans -- in order to smooth Bear Stearns' takeover by JP Morgan Chase. The secret Fed bailout came months before Congress authorized the government to spend up to $700 billion of taxpayer dollars bailing out the banks, even months before Lehman Brothers collapsed. The Fed also took on billions of dollars worth of AIG securities, also before the official government-sanctioned bailout.

The losses from those deals still total tens of billions, and taxpayers are ultimately on the hook. But the public never knew. There was no congressional oversight. It was all done behind closed doors. And the New York Fed -- then run by Tim Geithner -- was very much in the center of the action.

http://dailybail.com/headlines/robert-reich-the-feds-in-trouble.html

[DailyBail]

SECRECY AT THE FED: Bernanke Wanted To Keep AIG Bailout Debates Hidden From Public View

http://dailybail.com/home/secrecy-at-the-fed-bernanke-wants-to-keep-aig-bailout-debate.html

[DailyBail]

Issa, Bunning Demand Subpoenas For Fed's AIG Documents

http://dailybail.com/home/issa-bunning-demand-subpoenas-for-feds-aig-documents.html

[DailyBail]

The New York Fed, AIG Cover-Up Hearings (Geithner, Paulson, Baxter, Barofsky & Friedman, LIVE BLOGGING)

http://dailybail.com/home/watch-live-video-the-new-york-fed-aig-cover-up-hearings-geit.html

Dr. P and I did this live blog a couple years ago. There's some decent stuff in here.