Treasury Hid A.I.G. Loss, Report Says

[sabra]

Source: CNBC/NYT

The United States Treasury concealed $40 billion in likely taxpayer losses on the bailout of the American International Group earlier this month, when it abandoned its usual method for valuing investments, according to a report by the special inspector general for the Troubled Asset Relief Program.

“In our view, this is a significant failure in their transparency,” said Neil M. Barofsky, the inspector general, in an interview on Monday.

In early October, the Treasury issued a report predicting that the taxpayers would ultimately lose just $5 billion on their investment in A.I.G., a remarkable outcome, since the insurance company was extended $182 billion in taxpayer money in the early months of its rescue. The prediction of a modest loss, widely reported as A.I.G., the Federal Reserve and the Treasury rushed to complete an exit plan, contrasted with an earlier prediction by the Treasury that the taxpayers would lose $45 billion.

“The American people have a right for full and complete disclosure about their investment in A.I.G.,” Mr. Barofsky said, “and the U.S. government has an obligation, when they’re describing potential losses, to give complete information.”

Read more: http://www.cnbc.com/id/39846384

[No Elephants]

1. Everyone knows the bailout was a profitmaker for American taxpayers.

[ixion]

2. nice transparency...not

Thank God it passed! :sarcasm:

[bhikkhu]

3. I don't get all the bailout crap

If you read the article, it just says that a 45 billion "loss" is current, while projecting that 40 billion of that will be recouped. Hence the 5 billion figure. It doesn't seem unclear or "hidden" that the 5 billion figure is a projection, and I think a projection of net losses is at least as valid and valuable as a current standing.

[snot]

4. Imho, material facts re- the AIG bailout have been deliberately obfuscated.

I'm starting to believe the reason the current admin's done such a poor job defending its actions vis a vis the bankers is because they fear any detailed explanation will inculpate them.

[indepat]

5. I'm still waiting to learn how much windfall profit Goldman Sachs made on the, was it, $12.9 billion

received via the AIG bailout. I'm guessing +/- $12 billion. :shrug: