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.