Normally this would simply be a friendfeed item. But I don’t like blogging too irregularly and I’m busy at the moment. So it will do.
U.S. Rep. Steven C. LaTourette (R-OH) says he fears that John Dugan, Comptroller of the Currency, steered $7.7 billion of taxpayer bailout money to his former client, PNC, so it could buy National City Bank.
LaTourette today sent a letter to Treasury Secretary Henry Paulson outlining his concerns and asking for an investigation. He also asked House Financial Services Committee Chairman Barney Frank (D-MA) to hold a hearing on the Fed’s decision to have one regional bank (PNC) gobble up regional bank (National City) using bailout money. LaTourette is a senior member of the Financial Services panel.
The Pittsburgh-based PNC, which bought National City on Friday at a fire-sale price with federal bailout money, was one of Dugan’s clients just before he was sworn in as Comptroller of the Currency in August 2005, LaTourette said. Prior to becoming Comptroller, Dugan was a partner at Covington and Burling, a DC law firm that specializes in banking regulation.
“I am very concerned that the Comptroller first deprived bailout money to National City Bank and then orchestrated its sale to his former client, PNC. The officials at PNC have made it very clear that they were only able to buy National City because they got a $7.7 billion handout from the government,” LaTourette said. (Did Comptroller Steer Bailout money to his former Client, PNC?)
Read the whole release. It is eye-opening.
I suspect that all the parties asked to investigate already know, or already know they don’t care, what happened. Because this is exactly the arbitrary power that was given to the Secretary of the Treasury. This is Business as usual, now.
Welcomd to G-Sax Nation.