QUICKLINK   New York · August 25, 2009 · Freedom of information

Fed must disclose companies that received loans

The string of FOIA lawsuits for release of records of the government's emergency lending programs finally saw its first victory Monday. The Federal Reserve Board must release to Bloomberg News records identifying the financial firms it loaned bailout funds to as well as the assets or amounts put up as collateral, the news agency reported.

Chief Judge Loretta Preska in Manhattan federal court issued the first ruling requiring disclosure in a handful of suits in New York federal court brought separately by Bloomberg, Fox News and the New York Times. Bloomberg reported that she rejected the argument that the records were exempt from release under FOIA because they might harm the competitive advantage of the borrowers.

Bloomberg filed a FOIA request in May 2008 to learn more about the more than $2 trillion in taxpayer-funded loans issued by the Federal Reserve Board. The Federal Reserve System encompasses 12 regional banks, including the New York Federal Reserve Bank which runs most of the loan programs. While the Federal Reserve Board in Washington is subject to FOIA, a court decision held that the regional banks are not "agencies" and not subject to the law. However, Preska ordered the Fed to look for more records within the New York bank to satisfy Bloomberg's records request.

In late July, Judge Alvin Hellerstein also of the Manhattan federal court held the "discount window loan" records at issue in the Fox News lawsuit were properly withheld from the public because they may contain trade secrets or confidential information protected under FOIA  counter to Preska's findings for the records at issue in this case.

— Corinna Zarek, 3:19 pm

Comments: (3)

Comment by bois, Tue, Aug 25, 2009, 9:07pm

congressman mcfadden 1933
Mr. Chairman, we have in this Country one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board and the Federal Reserve Banks, hereinafter called the Fed. The Fed has cheated the Government of these United States and the people of the United States out of enough money to pay the Nation's debt. The depredations and iniquities of the Fed has cost enough money to pay the National debt several times over.

"This evil institution has impoverished and ruined the people of these United States, has bankrupted itself, and has practically bankrupted our Government. It has done this through the defects of the law under which it operates, through the maladministration of that law by the Fed and through the corrupt practices of the moneyed vultures who control it.

"Some people who think that the Federal Reserve Banks United States Government institutions. They are private monopolies which prey upon the people of these United States for the benefit of themselves and their foreign customers; foreign and domestic speculators and swindlers; and rich and predatory money lender. In that dark crew of financial pirates there are those who would cut a man's throat to get a dollar out of his pocket; there are those who send money into states to buy votes to control our legislatures; there are those who maintain International propaganda for the purpose of deceiving us into granting of new concessions which will permit them to cover up their past misdeeds and set again in motion their gigantic train of crime

Comment by Bois-terous, Wed, Aug 26, 2009, 12:46pm

The inflammatory rhetoric has no substance. Words. Words. Words. They ring as hollow as someone who would write that the Fed is the greatest financial boon to humankind. Unsubstantiated compliments and complaints accomplish nothing other than feed into already established bias. And Bois does not address what the article is about – the FOIA release determination of Chief Judge Loretta Preska. She ruled correctly and disclosure fans surround her with gratitude.

Comment by American Creditors-in-fact need answers now., Sat, Aug 29, 2009, 7:32pm

Follow-up e-mail to Corinna Zarek and Lucy Dalglish, Exec. Dir. Value of comments by Bois and Bois-terous is accepted. Now who will help produce disclosure of the back office accounting practices of "lenders" to American consumers that's been in-play for decades? No rhetoric, just a production and presentation of all of the numbers from all of the accounts involved in consumer lending please. May I suggest that court-ordered financial forensic investigation of lender accounts & practices will prove that "borrowers" finance their own loans? The disclosures will prove that the non-disclosure by "lenders" is systemic and fraud-in-waiting for "borrowers" when most consumer lending contracts are inked. FED pubs will verify lenders' ability to create funds from thin air via lender endorsement and deposit of borrowers' promissory notes, then cutting checks back to borrowers directly or indirectly from those "deposits". (If I can create money from a paper promise to repay, loan it & force re-payment of principal + interest in real funds and/or take your collateral for non-performance by contract, how long before I own all tangible wealth and you are my slave for generations?) Second, ask into the world of selling non-registered securities wherein "lenders" sell loan contract performance rights into the securities industry at discount ~equal to principal. See quarterly IRS Pub. #938 and SEC lender 434b5 prospecti of funds created via this MO. Who is the owner of the finance contract; the lender holding in due course, a securities buyer of performance rights or the Maker of the contract which is the "borrower"? Law says the contract is the Maker/borrower's property. Does the borrower get the money from the sale of the contract into the securities industry? Not likely. Who has defrauded the American people of much of the work-created wealth of a nation and is hoarding it while replacing it by circulating more debt obligations (FRNs) on a national scale??