[Congressional Record (Bound Edition), Volume 155 (2009), Part 19]
[Senate]
[Page 25729]
[From the U.S. Government Publishing Office, www.gpo.gov]




                         FEDERAL RESERVE POLICY

  Mr. DORGAN. Mr. President, I wanted to mention very briefly--and I 
will speak about this a bit more later--the daily news about the 
payment of very large bonuses by some of the largest financial firms 
that received TARP funds or other funds from the Federal Government to 
try to keep them afloat during difficult times last year. The notices 
of the bonuses and profits of those firms at this point are very 
troubling to me and to a lot of other people.
  I want to mention that a group of us a while back wrote to the 
Federal Reserve Board asking the Federal Reserve Board to release 
information about how much money went out the back door of the Federal 
Reserve Board when, for the first time in history, they allowed 
investment banks to come to the loan window of the Federal Reserve 
Board and get direct loans. For the first time in history, last year, 
they did that.
  Now the question is, Who got money from the Fed's direct window? 
Under what conditions did they get that money? How much money did they 
get? A lot of us have asked the Federal Reserve Board to release that 
information.
  Is that information important? It sure is, to me. Are the companies 
that are now proposing to pay the very large bonuses the same companies 
that got money out of the direct loan window of the Fed for the first 
time in history? Probably. What conditions were attached to that money? 
What were the rates, if any? We would like to know the specifics.
  On September 16, the Chairman of the Federal Reserve Board wrote back 
to us saying that releasing these names would hinder the Fed's 
assistance efforts.
  That is just a specious argument. The American people's money is put 
at risk. The American people have the right to know how much money went 
out that direct lending window at the Fed. We have a right to know--
Members of Congress, the American people have a right to know. The 
Federal Reserve Board is saying we don't have a right to know and they 
don't intend to tell us.
  I am going to talk about this a bit more later. There was a related 
FOIA case in which a judge found the Federal Reserve had ``improperly 
withheld agency records.'' The judge called the Fed's argument that 
borrowers would be hurt if their names were released--the judge says 
``that was conjectural, without evidence of imminent harm.''
  Despite the fact that the judge has determined that, we still don't 
have a release of this information. In a news article of a 
congressional hearing, it said a Federal official said the Fed was 
``giving serious consideration'' to releasing the names of firms that 
received assistance.
  In the same article they quoted Fed General Counsel Scott Alvarez as 
saying at the hearing:

       We would be happy to work with you to establish procedures 
     for disclosure.

  A few days following that a Bloomberg news article said:

       The Fed had decided to appeal the ruling that had ordered 
     the Fed to release the information.

  The question is, Why does the Fed believe we and the American people 
do not have a right to know? It makes no sense to me. I am going to 
speak about this at greater length later, but, clearly, as big bonuses 
are going out the back door, don't we have a right to know how much 
money went in the front door from the Federal Reserve to these 
institutions? How much, at what rate, and so on? I am going to continue 
to ask these questions.

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