Details of AIG Bailout to Remain Secret until 2018
The public will have to wait eight years to find out the details of the AIG bailout that Treasury Secretary Timothy Geithner oversaw in 2008 while running the New York operation of the Federal Reserve. Last May, the Securities and Exchange Commission quietly approved a request from AIG to keep secret until November 25, 2018, information about which banks and investment firms were given billions of dollars by a New York Fed entity to cover their mortgage-related securities insured by AIG. When the insurance giant began to collapse, businesses holding contracts with AIG were in danger of falling as well—until Geithner’s Fed bank stepped in with a bailout from an entity called Maiden Lane III to purchase collateralized debt obligations from unnamed counterparties. It is estimated that Maiden Lane covered up to $60 billion in toxic deals held by 16 financial institutions, including Goldman Sachs, Merrill Lynch, Société Generale, and Deutsche Bank.
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