BREAKING: Towns Joins Issa Investigation into AIG Counter-Party Deal

January 8, 2010

WASHINGTON. D.C. – House Committee on Oversight and Government Reform Ranking Member Darrell Issa (R-CA) welcomed Committee Chairman Edolphus Towns’ (D-NY) interest in new questions raised by Issa’s investigation surrounding Tim Geithner and the Federal Reserve Bank of New York’s decision to pay billions of dollars to AIG counterparties.

“The week of January 18th, the Oversight Committee will hold a hearing in which Secretary Geithner and NYFRB General Counsel Thomas Baxter will be invited to appear,” Issa said.  “Both Republicans and Democrats on this Committee have been waiting for more than a year to get answers from Secretary Geithner.  The documents my investigation has produced show that AIG was pressured by the FRBNY to conceal information related to Mr. Geithner’s decision to pay billions of taxpayer dollars to counterparties of AIG’s credit default swaps – including Goldman Sachs, Société Générale, and Deutsche Bank – to retire the swaps at 100 cents on the dollar, instead of demanding any concessions from these firms.  This decision was the subject of a report by the Special Inspector General for the Troubled Asset Relief Program (“SIGTARP”) and the source of much public outrage.”

Issa added, “Should Secretary Geithner or anyone else this Committee wants to hear from decline the invitation to appear, they should be subpoenaed.”

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