March 5th, 2009
12:51 PM ET
5 years ago

Fed wants to keep AIG secrets

A Federal Reserve official told the Senate Banking Committee Thursday that firms who received public money as a result of AIG's bailout should not be disclosed.
A Federal Reserve official told the Senate Banking Committee Thursday that firms who received public money as a result of AIG's bailout should not be disclosed.

NEW YORK (Fortune) - Officials shouldn't reveal which Wall Street firms pocketed billions of dollars in the government's bailout of AIG, a top Federal Reserve official said.

Firms that did business with the troubled insurer did so "expecting confidentiality," Fed Vice Chairman Donald Kohn told the Senate Banking Committee in testimony Thursday.

He said publishing a list of the firms that benefited from government support of AIG - as lawmakers have been demanding - could undermine trust in the markets and increase financial instability.

"I would be very concerned if we started revealing lists of names of companies that did transactions" with AIG or with the government on AIG's behalf, Kohn said in response to questions. Doing so, Kohn added, could "undermine confidence" in the financial system.

The comment was met with incredulity by senators who said the government must do a better job explaining how its actions over the past six months have benefited all Americans, and not simply troubled big companies and their trading partners. AIG has received more than $150 billion in federal aid since its brush with bankruptcy last fall.

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Filed under: TARP
soundoff (16 Responses)
  1. america first

    It's time to let the taxpayers know what these companies did with OUR MONEY, the trust for aig, and all these companies has BEEN LONG GONE, it's time for some HONESTY. no more bailouts.

    March 5, 2009 01:51 pm at 1:51 pm |
  2. Had It

    NO – Their names should be known. What are they ashamed of? They have OUR Money – we need to know who they are.

    NO MORE Bush/Cheney/Rove style secrecy !!

    March 5, 2009 01:53 pm at 1:53 pm |
  3. Cindy

    Bad bad bad... They are only making us more suspicious. What are the hiding? No more money, AIG needs to go.

    Even Bill Clinton released his list, AIG needs to, too.

    March 5, 2009 01:54 pm at 1:54 pm |
  4. Had It

    No more money EVER until their names are known. We have rights if we're responsible for bailing them out AGAINST OUR WILL.

    March 5, 2009 01:54 pm at 1:54 pm |
  5. Beverly, NYC

    The Fed Chairman made an argument this dumb?. Is he kidding!!! Better the list come out now when the system can recover than dip 6 months from now when we all know the list "leaked". This taxpayer is quite interested in knowing which rabbit hole 150 billion disappeared into, and who had their hands out. I'm an adult I can take it!!

    March 5, 2009 01:56 pm at 1:56 pm |
  6. Vivan

    Give me a break! Keep their secrets. This is not "don't ask; don't tell". This is supposed to be an open bailout. Meaning if my taxpaying money is bailing out the big shots at AIG and their counterparts I want to know who they are and what they did with my taxpayer money. Why should they fear anything? f their actions were honest and true what is the big deal if we know who "they " are? As for undermining the confidence in the financial markets, how could it be any worse? Does anyone have any confidence in these great financial companies that were so greedy? Does anybody really care about their feelings? Did they care about mine when this all started? NO! All they cared about was lining their pockets and taking fancy expensive vacations or conventions in places I will never see. I run a small family business and have not had a vacation in 3 years.It is all I can do to stay open and pay the bills in this economy. So I say open the books and let us see who benefited from the AIG 150 billion dollar bailout. I want to know. What abut you America; Don't you want to know?

    March 5, 2009 02:00 pm at 2:00 pm |
  7. lovable liberal

    Oh, BS. We bought it. We own it (or should). We should get any information we want out of it.

    March 5, 2009 02:01 pm at 2:01 pm |
  8. Pee Wee

    NEWS FLASH MR. KOHN >>>>>>>>>

    There is currently NO confidence in the financial system to be undermined.

    All this talk of transparency and all we get is a smoke screen.

    Where's Pat Leahy on this one?

    March 5, 2009 02:19 pm at 2:19 pm |
  9. Roger

    But wait....Obama promised transpanrency.

    March 5, 2009 02:19 pm at 2:19 pm |
  10. U gotta be kidding

    and you thought Bush was bad. at least he didn't steal the money then say up yours.

    March 5, 2009 02:23 pm at 2:23 pm |
  11. Armando

    Everyone call your congress critter and tell them to support HR 1207 a bill to audit the federal reserve. Transparency is needed!

    March 5, 2009 02:26 pm at 2:26 pm |
  12. JOSE IN NORTHRIDGE

    OBAMA,,,,,,,,,,TRANSPARENCY

    March 5, 2009 02:27 pm at 2:27 pm |
  13. Bill_ MA

    Fed Vice Chairman Kohn, and others must go. Americans have had had enough of secrecy. It's time the elected officials got some guts, and begin to look out for the taxpayers. Instead of showing incredulity as though they didn't know, the senators have to earn their wages, and do something. How long is congress going to hide? Incredulity???? WOW, Kohn's comments were met with incredulity.Kohn must be shaking in his boots knowing that. WOW!!!

    March 5, 2009 04:02 pm at 4:02 pm |
  14. Astounded

    Excuse me, but that's MY money, and my terms are that I know how it was used. We have every right to know. Lending institutions write terms into their loans, and we have every right to do the same. If I take a loan, it's for a specific purpose and I have to use it for that. Now it's their turn.

    March 5, 2009 05:22 pm at 5:22 pm |
  15. sick n tired of CNN moderators

    Nothing should be "confidential" when it concerns TAXPAYER MONEY! And if Mr Kohn doesn't like it Mr Kohn can find himself a new job taylor made to meet his approval.....................Good luck with that!!!!!!!

    March 5, 2009 05:31 pm at 5:31 pm |
  16. Kent

    Perhaps Mr Kohn hasn't noticed, but confidence in our financial markets has already been undermined. Maybe all the secrecy has some connection with the lack of trust. Think it through Mr Kohn. If these people have something they want to hide, how does that improve our confidence in them? What are they hiding?

    March 6, 2009 09:41 am at 9:41 am |

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