Comments from the Office of Thrift Supervision, which regulated IndyMac, said "the immediate cause" of the failure was statements made by Sen. Charles Schumer, a New York Democrat. Mr. Schumer in late June publicly raised concerns about the bank's solvency.
"Although this institution was already in distress, I am troubled by any interference in the regulatory process," said OTS Director John Reich.
IndyMac responded to irresponsible leaks by Schumer with this comment included "as a result of Sen. Schumer making his letters public and the resulting press coverage, we did experience elevated customer inquiries and withdrawals in our branch network last Friday and on Saturday of roughly $100 million"
The LA Times reported
John Reich's comment "Dissemination of incomplete or erroneous information can erode public confidence, mislead depositors and investors, and cause unintended consequences, including depositor runs and panic stock trades. Rumors and innuendo cause damage to financial institutions that might not occur otherwise and these concerns drive our strict policy of privacy."
John D. Hawke, the U.S. comptroller of the currency (regulator of national banks) from 1998 to 2004, had more pointed words for Schumer in a story in the American Banker newspaper today.
"If Schumer continues to go public with letters raising questions about the condition of individual institutions, he will cause havoc in the banking system," Hawke said.
"Leaking his IndyMac letter to the press was reckless and grossly irresponsible. I don't see how he can be trusted with confidential information in the future. What this incredibly stupid conduct does is put at risk the willingness of regulators to share any information with the [congressional] oversight committees. After this, you'd be crazy to share information with Schumer."
So, as one comment stated in the previous post about Schumer's grand standing, they were concerned P IV was not citing sources other than the Wall Street Journal. Here is continuing coverage of the unrestrained boisterous Senator, for those who want to continue to defend his actions.
3 comments:
Thank you to Senator Schumer for warning the public and keeping us apprised of our Nation's financial situation. Mr McCain and Phil Gramm are still lying about our "great economy".
The New York Times is reporting today that as many as 150 Banks may be in trouble. Political IV and his Republican friends would prefer that everything be kept real quiet so that the Banks and their investors are protected while they clean out their drawers and our pockets while let the customers hold the bag.
There is much more to the Banking story that Senator's Schumer's fair warning.
Schumer's an idiot who is only interested in promoting himself. As usual, rwiley is nuts. Maybe Schumer should disclose some confidential infomation about our troops so we can lose this war and get the hell out of Iraq, right rwiley?
Let's face it, the public's too stupid to be given some information, just as the bank story indicated. They fools will rush to the bank to withdraw their money because they're too stupid to realize the FDIC will cover their money.
Schumer should apologize, shut up and sit down, for once!!
Someone one quipped:
"The most dangerous spot to stand is between Chuck Schumer and a microphone."
Post a Comment