Posted on 05/06/2009 4:12:49 PM PDT by Libloather
Bigger Than Watergate?
By Olivier Garret, CEO, Casey Research
Posted Wednesday, 6 May 2009
Reportedly, Bill O’Reilly referred to a recent story out of our nation’s capital as “bigger than Watergate.”
Whether the story is bigger than Watergate or not, it is definitely a scandal of huge proportions.
To sum it up, on April 23, 2009, New York Attorney General Andrew Cuomo sent a letter to Chairman of the U.S. Senate Committee on Banking, Housing, and Urban Affairs Chris Dodd; Chairman of the House Financial Services Committee Barney Frank; SEC Chairwoman Mary Schapiro; and Chairwoman of the Congressional Oversight Panel Elizabeth Warren.
The letter outlined how former Treasury Secretary Paulson and Fed Chairman Ben Bernanke forced Bank of America’s acquisition of Merrill Lynch – even though Bank of America CEO Ken Lewis and the board of directors tried to pull the plug on the deal after it turned out that Merrill Lynch was far deeper in debt than it had admitted.
In the words of Attorney General Cuomo himself:
Immediately after learning on December 14, 2008 of what Lewis described as the “staggering amount of deterioration” at Merrill Lynch, Lewis conferred with counsel to determine if Bank of America had grounds to rescind the merger agreement by using a clause that allowed Bank of America to exit the deal if a material adverse event (“MAC”) occurred. After a series of internal consultations and consultations with counsel, on December 17, 2008, Lewis informed then-Treasury Secretary Henry Paulson that Bank of America was seriously considering invoking the MAC clause. Paulson asked Lewis to come to Washington that evening to discuss the matter.
Bank of America’s attempt to exit the merger came to a halt on December 21, 2008. That day, Lewis informed Secretary Paulson that Bank of America still wanted to exit the merger agreement. According to Lewis, Secretary Paulson then advised Lewis that, if Bank of America invoked the MAC, its management and Board would be replaced.
Meanwhile Ken Lewis has been sacked as chairman of the board at Bank of America… even though he might well have been the only conscientious and honest player in this scheme. And now the sharks have started to turn on each other: according to Cuomo, Paulson “largely corroborated Lewis’s account” and informed the attorney general’s office that he “made the threat at the request of Chairman Bernanke.” The latter has so far chosen to keep his mouth shut.
The key factor here is not that the Devious Duo forced Bank of America into a merger it didn’t want to commit to. Granted, that’s an unheard-of interference of government in the free market, but we’re quite sure that the Powers-That-Be could sweep it under the rug by invoking the “greater good.”
No, the part of the story that could really break Al Paulson and Don Bernanke’s necks is the failure to inform the Securities and Exchange Commission, as well as Bank of America’s shareholders, of the extent of toxic waste Bank of America was forced to accept. That’s fraud, pure and simple.
And that’s a pretty good sign that this is not going to go away. Some of the Casey Research editors – yes, we do have bets out – think it’s going to be huge, especially since the scandal happened on President Bush’s watch and the Democrats are in control of Congress. Chances are that either Paulson or Bernanke is going down, depending who cuts a deal with prosecutors first. Their “friends in high places” may be able to keep the Justice Department out of it, but they won’t be able to control ambitious state officials like Cuomo. There’s blood in the water, and this is a career maker for a prosecutor.
That also applies to the Hussein administration, ACORN and RATS in general.
Too bad nothing will be done about it...since it’s Dems and the MSM won’t pursue it.
they were taught by the best, it seems...
So we have MASSIVE fraud taking place by the people in elected office. Fraud at a level to make Madoff look like an amatuer.
No surprise but what are we gonna do about it? BO doesn’t have the stones to do anything but yap.
That’s the point of this story....when the Obama Administration tries to ignore this, some ambitious little SOB like Andrew Cuomo can and will make a name for themselves over this.
This is exactly the kind of thing that Eliot Spitzer set out to do as well, before he self-destructed. Cuomo is as ambitious as they come, and I have no doubt he has his sights set on Eric Holder’s job in the second Obama Administration...
He is hardly a hero. HE CAVED IN TO PAULSON! Hello every movie you've ever seen should prepare you to know what to do in this situation. What would John Wayne have done? What would the Clint Eastwood character have done? What would the character of Mr. Smith in "Mr. Smith goes to Washington" have done?
Istead Lewis acted like the punk-*ss litte b*tch he is and kissed the butt of Hank Paulson.
What a great way to end a legendary career! Being fired by the Sec. of the Treasury for refusing to go along with a looting scheme aimed at your bank. Instead he let the looting take place, kept his mouth shut, and finally coughed up the truth under oath in an interview with the AG.
That ain't heroic.
Where have all the cowboys gone?
This country runs on greed.
And we know what the likelihood of that is where democrats are concerned.
Look, there've been plenty of opportunities to nail democrat lawbreakers rivaling Watergate in size (some bigger) the media has shown NO inclination to pursue.
WWMDD?
What Would Milburn Drysdale Do?
BTTT/FFR
More strong arm tactics from the Rats from the District of Chicago.
You are right there. The communists RAT party has successfully taken control of America. The corruption is unbelievable and will not stop.
Wait till we get to the GM and Chrysler deals. Won’t matter if Dems are against litigation once the lawyers taste blood.
New York Attorney General Andrew Cuomo sent a letter to Chairman of the U.S. Senate Committee on Banking, Housing, and Urban Affairs Chris Dodd; Chairman of the House Financial Services Committee Barney Frank; SEC Chairwoman Mary Schapiro; and Chairwoman of the Congressional Oversight Panel Elizabeth Warren. The letter outlined how former Treasury Secretary Paulson and Fed Chairman Ben Bernanke forced Bank of America’s acquisition of Merrill Lynch – even though Bank of America CEO Ken Lewis and the board of directors tried to pull the plug on the deal after it turned out that Merrill Lynch was far deeper in debt than it had admitted.Been topics about this, but this one seemed clearer to me.
Unless Andy's investigation is more shotgun than laser. Maybe he takes Dodd and Fwank down and damages the haloed one enough to open the door for Hillary in 12.
But this story undercuts the meta-narrative that banks are evil and govt is good. Tough choice for Obama. I’m guessing Bernacke will be collared with the blame so Obama can get his stooge as chairman of the fed. Paulson has already been replaced.
Something tells me that pressure that Bernanke was applying was coming from those that created this crisis in the first place. Bernanke serves masters other than the President and people of the United.States.
Well I wasn’t around for Watergate but it HAD to be juicier than this.
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