Emails obtained by ranking member of the House Oversight and Government Reform Committee, Rep. Darrell Issa (R-CA) support claims that Treasury Secretary, Tim Geithner’s actions in handling the financial crisis and the bankers on Wall Street warrants deeper investigation.

The Federal Reserve Bank of New York, while led by Geithner, pressured AIG not to disclose payments it made to such banks as Goldman Sachs Group and Deutsche Bank, to settle swap contracts at the height of the financial crisis….Emails between Geithner’s Fed and AIG lawyers show that the embattled insurer originally included the information about the swaps in a draft securities filing. But under review by the Fed, AIG was told to cross out references to the swap payments, which were made at 100 cents on the dollar.”

Taxpayer money was used to buy bad assets at full price. And we may discover that abuses don’t end there. The Troubled Asset Relief Program may turn out to be the greatest rip off ever perpetrated on the United States Treasury.

The e-mails span five months starting in November 2008 and include requests from the New York Fed to withhold documents and delay disclosures.

When the suggestion first arose some 18 months ago that the banks might be in trouble, it was likely already too late to stop the inevitable. Insiders, like then Treasury Secretary Hank Paulson and Fed Chairman, Ben Bernanke, along with the CEO’s of the largest recipients of bailout money, may have been well aware of the fact that the bottom was falling out. The books could no longer be juggled to hide mistakes. It was just a matter of time.

In an effort to save Wall Street from disaster in a public panic, the concept of the TARP fund was born. But was it intended to be the artificial glue of our financial system, or protect the personal paychecks and assets of bank executives?

The New York Fed took over negotiations between AIG and the banks in November 2008 as losses on the swaps, which were contracts tied to subprime home loans, threatened to swamp the insurer weeks after its taxpayer-funded rescue. The regulator decided that Goldman Sachs and more than a dozen banks would be fully repaid for $62.1 billion of the swaps, prompting lawmakers to call the AIG rescue a “backdoor bailout” of financial firms.

When the plan for TARP was made public, no visible rules were imposed on the banks. It was a virtual blank check. A year after getting free money from the FED, the banks made no effort to hide their record profits.

In hindsight we can see that behind closed doors, no deal had ever been made to save homeowners from the sinking economy and the foreclosure crisis. It was all about the banks. Even now, homes continue to be taken back by their lenders in record numbers. The beneficiaries of TARP were the gamblers of Wall Street, and in their wake are the remnants of the middle class.

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