Financial Crisis Inquiry Continues
The 10-member bipartisan Financial Crisis Inquiry Commission established in 2009 to examine the causes of the biggest economic downturn since the Great Depression continued televised hearings into the near-collapse of the financial system in 2008. Two prominent members of Leadership 100 serve on the commission, Phil Angelides, the former California Treasurer, who was appointed Chairman, and Byron Georgiou of Las Vegas, Nevada who has had a long career in the private and public sector in government service, business and law, and has spent most of the last decade investigating and prosecuting financial fraud. He is currently the President of Georgiou Enterprises and has had a leadership role in the historic litigations prosecuting financial fraud on behalf of defrauded investors at Enron, WorldCom, Dynegy, AOLTimeWarner, and UnitedHealth. He holds a Juris Doctor degree magna cum laude from Harvard Law School.
In recent testimony, Charles O. Prince III, Citigroup’s former chairman and chief executive, apologized for the billions of dollars of losses that caused the company he helped build to nearly collapse. The bank required three government rescues and some $45 billion in taxpayer aid. Robert E. Rubin, an influential Citigroup board member and adviser, whose career took him from chief of Goldman Sachs to Secretary of the Treasury during the Clinton Administration, cited at least nine different causes for the financial crisis, which formed a toxic cocktail that, he claims, “almost all of us” missed. “We all bear responsibility for not recognizing this, and I deeply regret that,” Mr. Rubin said in his testimony.
Previously, the bipartisan panel questioned the former Federal Reserve chairman, Alan Greenspan, on his deregulatory stance and over his failure to crack down on subprime lending abuses.
The 10-member commission, with a budget of just $8 million, is charged with delivering a comprehensive report to President Obama by Dec. 15 on 22 factors associated with the crisis, from mortgage fraud to regulatory failings. In particular, the commission will look into issues such as the role of exotic financial instruments and credit rating agencies, executive pay, and why the regulators failed to handle risky lending at banks. . The commission, with subpoena power, is supposed to be modeled on the Pecora Commission, which investigated the events that led to the 1929 stock market crash and the Great Depression.
