March 2, 2012. New York. Do an online search for news on the detainment of Treasury Secretary Timothy Geithner exactly one week ago and not a single mainstream news article will be found. With the law closing in, even America’s corporate media appears to be in panic mode. Blacked out since it happened last week, US Treasury Secretary Timothy Geithner was in fact detained and questioned by law enforcement officials in New York.
Treasury Secretary Tim Geithner the day after being questioned by authorities in New York. Image courtesy of Reuters.
For the record, no information has been released by either Tim Geithner or law enforcement officials. And absent the original Bloomberg News article that broke the story, it’s not even apparent what government agency, if not multiple agencies, detained and questioned the nation’s current Secretary of the Treasury.
What is known and being sparsely reported by outlets like Bloomberg and Fox News is that the questioning is related to Timothy Geithner’s actions while head of the Federal Reserve Bank of New York. While in that roll, Geithner used his FED authority to influence the first multi-billion dollar taxpayer bailout of the financially devastated AIG insurance company. The Secretary has already been accused publicly by numerous sources, including lawyers for the failed Lehman Brothers bank, of other legally questionable acts. Now, he’s reportedly being accused of directing AIG lawyers to hide certain embarrassing information about what AIG was going to do with its bailout money.
Just prior to being enriched with the most powerful job in the financial world – Secretary of the entire US Treasury – Timothy Geithner was head of the NY FED. In 2008, during the beginning of the US banking and economic collapse, Geithner inserted himself into the negotiations between then Treasury Secretary Hank Paulson and AIG. The discussions regarded a desperately-needed bailout of AIG. There, it’s alleged, Geithner instructed AIG lawyers to withhold the fact that the taxpayer bailout money was going to flow right through AIG and into the accounts of Goldman Sachs.
Goldman Sachs had created and sold worthless, toxic, mortgage-backed derivative funds and then insured them with AIG insurance. When the funds collapsed as Goldman employees knew they would, AIG was forced to pay off casino-style bets that Goldman Sachs had made on its own worthless assets. AIG didn’t have the money to cover its own wagers and was forced to go to the American people for a bailout.
Secretary Geithner has been in legal trouble since before taking the nation’s top financial roll. Just prior to Senate confirmation hearings, Geithner admitted to hiring illegal immigrants and evading taxes. After paying the required fines to the IRS and insisting he wasn’t aware he was breaking the law, Geithner was simply allowed to pay his way out of trouble.
After being elevated to Secretary of the Treasury, numerous Wall Street executives have privately accused Tim Geithner of intimidation and threats of retribution if they did not follow the direct orders of the Federal Reserve and Treasury. Appointed CEO of Citigroup just in time to take the fall for that bank’s roll in the global economic collapse, Vikram Pandit is known for being one of the only bank CEO’s to stand up to the strong-arm tactics. Paraphrasing, Pandit is credited with telling Paulson and Geithner that what they were doing was illegal and un-Constitutional and he wasn’t going to play ball.
Now, only three years later, law enforcement officials finally seem to be catching up with the main players of the scheme devised at the highest levels of government. Secretly diverting the initial $13 billion dollar bailout of AIG to Goldman Sachs, attorneys for AIG are now reportedly agreeing to testify against Tim Geithner, and possibly others, for his role in pressuring them to withhold vital information from the public, and possibly Congress, government regulators and those in charge of approving the secret bailout. Goldman Sachs wasn’t the only giant Wall Street bank being paid 100 percent on the dollar by AIG while other investors were going to receive 0. Those details are still being sought. AIG turned out to be the largest recipient of taxpayer bailout funds to the tune of $185 billion.
As reported on Fox News, and credited to Bloomberg News, the legal problems for Timothy Geithner come down to two separate questions:
If Treasury Secretary Tim Geithner is proved to be guilty of criminal acts yet again, he could find himself in serious trouble.
One of the few sources covering the story is Occupy Wall St., located right down the street from the action. One article on the site quotes New York police officers present at Geithner’s questioning as describing the Treasury Secretary as being more than cooperative. Occupy Wall St. quotes the NY cop saying, “In most cases we have to slap people to get them to talk but in his case we had to slap him to shut him up.”
If the AIG attorneys truly did turn state’s evidence on Tim Geithner and the Treasury Secretary is now described as attempting to turn on the people even higher up, it’s difficult to envision who those people could possibly be. Tim Geithner, along with three other individuals, are at the top of the Treasury-AIG-Goldman Sachs conspiracy. The only possible person higher up would be former President George W. Bush. But as many witnesses describe, the President was frozen like a deer in the headlights during the 2008 economic collapse and didn’t have the urge or ability to understand the crisis anyway.
The top four beneficiaries of the Treasury-AIG-Goldman Sachs conspiracy were:
-Timothy Geithner: Former head of the NY FED, rewarded with appointment by President Barack Obama to Secretary of the Treasury.
-Hank Paulson: Former Goldman Sachs CEO and Treasury Secretary at the time, alleged to have broken more laws than any other single individual during the financial crisis. Documented in dozens of books and statements by the CEO’s and attorneys of banks like Citigroup, Morgan Stanley, Lehman Brothers, Wells Fargo, Countrywide, Merrill Lynch, Bank of America and others, that Hank Paulson forced these very same CEO’s with threats of government retribution to buy and sell their entire global corporations with no more than a couple days notice and by lieing to their individual Boards of Directors and shareholders.
In just one instance, JP Morgan Chase CEO Jamie Dimon was give such a secret, midnight, sweetheart deal by the taxpayers compliments of a Paulson mandate, that JP Morgan was happily forced to buy Bear Stearns, one of the largest and most prestigious investment banks in the world, for a mere $236 million – or $2 per share. The main building of Bear Stearns was worth more than that. JP Morgan was handed a global powerhouse practically for free. In addition, thanks to Paulson, Jamie Dimon and JP Morgan were secretly guaranteed that the American people would reimburse the bank for any toxic assets on Bear Stearns books, which were in the billions.
-Martin Sullivan: CEO of AIG from 2005-2008, inherited the firm from AIG’s legendary founder Maurice Greenberg. With only two CEO’s to level charges at – Greenberg and Sullivan – it should be pretty difficult to miss. Unlike Citigroup’s new CEO Vikram Pandit who walked into the firestorm well after it had ended, Martin Sullivan has been in the belly of the AIG beast since he began his career in its London office in 1970. When he resigned from AIG in 2008 amid massive scandal and fraud, Paulson and Geithner allowed him to personally pocket $47 million of the AIG bailout on his way out the door. Since his main roll in one of the largest corporate collapses in US history, Sullivan has since been hired by the powerful Willis Group Holdings, new owner of the Sears Tower, America’s largest building.
-Lloyd Blankfein: CEO of the most powerful corporation in the world since 2006, Lloyd Blankfein also worked his way up through the ranks of Goldman Sachs to find himself at the center of the largest financial conspiracy in American history. Goldman Sachs has proven to be not only responsible for creating the worthless, toxic funds that caused the economic collapse, but marketed and sold them as wonderful investments. Drunk with profits, the bank even bought its own worthless funds, causing it to teeter on the brink of bankruptcy in 2008.
With a host of former Goldman Sachs executives lining the Obama White House and with its own former CEO Hank Paulson at the head of the Treasury Dept., Goldman Sachs was able to secure repeated multi-billion dollar bailouts, the destruction of its century-old main rival Lehman Brothers and billions in profits due to the unlimited discount borrowing the US Treasury allows Goldman Sachs to do on a daily basis.
From 2008 to 2011, Blankfein personally pocketed over $100 million in bailout money and bonuses. While he likes to promote his official $2 million base salary, the Goldman Sachs CEO has been rewarded in other ways, such as a gift of nearly 80,000 shares of Goldman stock one year and a near $10 million bonus another year. One bonus awarded to Blankfein at the end of 2009 and during the economic collapse was estimated by the NY Daily News to be worth $100 million.
Perhaps the biggest way the above four profited is by the fact that none of them has been arrested, tried, convicted and imprisoned…yet.
Timothy Geithner responds
In an editorial published in the Wall Street Journal today, Treasury Secretary Tim Geithner mysteriously responds to charges that haven’t even been allowed to be raised in the mainstream press. Geithner literally and ominously begins his editorial today with the sentence:
“Four years ago, on an evening in March 2008, I received a call from the CEO of Bear Stearns informing me that they planned to file for bankruptcy in the morning.”
His opening statement begs the question, why was the CEO of Bear Stearns secretly calling the head of the NY FED in the middle of the night?
Already attempting to deflect charges, Geithner goes on to transfer the blame from himself and the other handful of individuals directly responsible, to the whole of the American people. Geithner writes:
“The financial safeguards in the law at that moment were tragically antiquated and weak. Neither the Fed, nor any other federal agency, had the necessary comprehensive authority over investment firms like Bear Stearns, insurance companies like AIG, or the government-sponsored mortgage giants Fannie Mae and Freddie Mac.”
Could Timothy Geithner be on the verge of outing the notorious and elusive ‘shadow government’? Since he is one of its most powerful players, he is most definitely in a position to do it. Geithner continues explaining in today’s Wall Street Journal:
“A large shadow banking system had developed without meaningful regulation, using trillions of dollars in short-term debt to fund inherently risky financial activity. The derivatives markets grew to more than $600 trillion, with little transparency or oversight. Household debt rose to an alarming 130% of income, with a huge portion of those loans originated with little to no supervision and poor consumer protections.”
We at Whiteout Press have never been in agreement with the beliefs, policies or tactics of Timothy Geithner. But we can’t help but agree with the final statement of his Wall Street Journal appeal, “We cannot afford to forget the lessons of the crisis and the damage it caused to millions of Americans.” Indeed Mr. Geithner, indeed.