Today Neil Barofsky, special inspector general for the TARP, has taken our assumption a step further and has launched a full blown probe into just what may have happened into those two fateful months.
Legislators want to know if AIG offered less to retire the contracts and whether there was any review about banks’ ability to sustain losses on the derivatives.It will be interesting to see whether an affirmative outcome of the probe will lead to the banks forfeiting any above normal trading profits due to unethical trading practices.
“To what extent did AIG pay counterparty claims at 100 percent of face value and was any attempt made to renegotiate and close out these claims with ‘haircuts?’” Barofsky wrote. “Questions concerning whether AIG paid more than necessary to counterparties and whether Treasury adequately monitored such payments are clearly relevant.”
Zero Hedge will continue to strive to provide light into those opaque situations that allow the "sophisticated" financial professionals to take advantage of all known loopholes at the expense of U.S. taxpayers. We are happy to have been beneficial in this endeavour. Sphere: Related Content Print this post