ny times: Lax Oversight of Citi Bank Even *After* Citi Gets TARP Funds:

[amborin]

Fed Reviews Find Errors in Oversight of Citigroup

Stephen Crowley The New York Times

"....even after taxpayers rescued the financial giant, regulators failed to monitor the company adequately, according to reviews by the Federal Reserve.

snip

....excerpts, culled from thousands of documents turned over to the bipartisan Financial Crisis Inquiry Commission, painted a troubling picture of the Fed’s oversight of Citigroup both before and after Mr. Greenspan left the Fed — and again after Citigroup received three taxpayer-financed bailouts.

The most recent documents from 2009 portray bank examiners from the Federal Reserve Bank of New York, then headed by Timothy F. Geithner, now the Treasury secretary, as overly optimistic about Citigroup’s prospects, according to a person briefed on their contents.

They also suggest that the Fed examiners failed to move swiftly as Citigroup’s financial condition deteriorated, according to this person, who spoke on the condition of anonymity so as not to jeopardize the commission’s inquiry.
Together, the excerpts suggested that oversight of Citigroup was inadequate as far back as 2005 and remained so as recently as late December.
“Although the dedicated supervisory team is well-qualified and generally has sound knowledge of the organization, there have been significant weaknesses in the execution of the supervisory program,” according to one excerpt of the 2009 review.

snip

Mr. Geithner, who as president of the New York Fed from 2003 to 2008 was in charge of overseeing Citigroup, has not yet been interviewed by the panel’s investigators but most likely will be called for questioning.

According to the Fed reviews, the New York Fed failed to keep a close enough eye on Citigroup for years. A 2005 review found that the New York Fed had neither the time nor the staffing to supervise Citigroup adequately, according to the person briefed on the review....

snip

http://www.nytimes.com/2010/04/08/business/08panel.html?ref=todayspaper

[leftstreet]

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