FDIC fails to disclose information about bank bidders
From Sunshine Review
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September 4, 2009 The Federal Deposit Insurance Company has failed to disclose the information requested of them through Freedom of Information Act procedure regarding the bidders on the bank failures from fall 2008.[1]
[edit] FOIA request
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| State sunshine laws |
| The WikiFOIA portal |
The FDIC, the federal agency put in charge of failed banks and selling their assets, is withholding key details about the transactions between the failed banks from fall 2008 and those that bid on the assets. They have not released the identities of the losing bidders or the prices offered, for example.
The information had been publicly available for decades, but requests for the information was limited this year.
After the government bailed out financial companies like Citigroup, AIG and Bank of America, it is responsible for another $80 billion through an FDIC program that is little-reported on. The program is designed to encourage private investors to buy failed banks and their assets.
The FDIC effectively takes over when banks fail with the alleged plan of returning them to the private sector as soon as possible. Typically, other banks would make offers to the FDIC successfully. In this case, private equity groups are eligible investors. No matter whether the investor is private or a bank, the FDIC is bound by law to choose the "least costly" bid.
American Banker reported that the documents that would detail winning and losing bids, which have been officially requested through FOIA requests, have not been released. Winning bids have been disclosed, but most of the losing bids have not.
"We don't know whether the government got us the best deal," said Kenneth Thomas, an independent bank consultant and finance lecturer at the University of Pennsylvania. "We're not talking millions -- we're talking billions of dollars."
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[edit] References
- ↑ "Questions Arise As FDIC Fails To Disclose Key Details On Bidders For Failed Banks," Huffington Post, September 4, 2009
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