US Rep Frank Wants Investigation Of AIG Counterparties
02 April 2009 - 8:54AM
Dow Jones News
The lead U.S. House Democrat on financial issues called
Wednesday for an investigation into whether U.S-based financial
institutions who were counterparties to American International
Group Inc. (AIG) received disparate treatment compared to their
foreign-owned rivals.
House Financial Services Chairman Barney Frank, D-Mass., asked
top officials at the Federal Reserve and Treasury Department to
look into the issue, which has been raised by the panel's leading
Republican, Rep. Spencer Bachus of Alabama.
"I do not know what basis there is for the point he makes, but
it is a serious issue and must be addressed," Frank said in a
letter to Fed Chairman Ben Bernanke and Treasury Secretary Timothy
Geithner.
Bachus said in recent letter to Frank that he has received
information suggesting that AIG is trying to "force many of its
creditors that are U.S. banks to accept severe reductions in the
debt owed to them." Bachus said in the March 26 letter.
Frank wrote to Bernanke and Geithner that any sort of different
treatment for foreign counterparties "does not seem to me to have
any basis whatsoever in the law, in policy, and certainly not in
the need for a public acceptance of your actions.
-By Michael R. Crittenden, Dow Jones Newswires; 202-862-9273;
michael.crittenden@dowjones.com