By Matthew Russell Lee
UNITED NATIONS, September 26 -- The secret recordings of then Federal Reserve examiner Carmen Segarra about Goldman Sachs and regulatory capture should trigger oversight hearings in Congress, and the break-up of Goldman Sachs and its peers.
But this type of sleaze is the rule, not the exception. Inner City Press routinely submits Freedom of Information Act requests for communication between the Fed and banks applying for mergers.
Most recently, the Fed has extended its deadline for responding to Inner City Press' request on CIT - OneWest, on which it purported to close its public comment period on September 24:
FOIA Request No. F-2014-00380
Dear Mr. Lee,
On August 27, 2014, the Board of Governors ("Board") received your electronic message dated August 26, pursuant to the Freedom of Information Act ("FOIA"), 5 U.S.C. § 552... On August 28, 2014, the Board’s Freedom of Information Office made an interim production of responsive documents consisting of the public portion of the application by CIT Group Inc. and Carbon Merger Sub LLC to acquire and merge with IMB HoldCo LLC, and thereby indirectly acquire voting shares of OneWest Bank... Pursuant to section (a)(6)(B)(i) of the FOIA, we are extending the period for our response until October 9, 2014, in order to consult with two or more components of the Board having a substantial interest in the determination of the request. If a determination can be made before October 9, 2014, we will respond to you promptly.
How can the public be shut out before it has the basic information it has requested?
Tellingly, when lawyers leave the Federal Reserve's Legal Division, many go to white shoe law firms that submit bank merger applications to the same people they until recently worked with or supervised.
Inner City Press, Bronx-based Fair Finance Watch and NCRC have repeatedly raised this to the Fed, without meaningful response.
So here's hoping that Carmen Segarra's courage, in secretly making the recordings and then releasing them, leads to increased oversight of and reform at the Fed.
The problem is, while some in Congress are willing to criticize the Fed, the real parties in interest here are the largest banks and investment banks in the country. Who in Congress will directly challenge those? Watch this site.
