Thursday, March 7, 2013

"We have so many more questions for Mr. Lew"

When you are a technocrat for the crony elite, you don't have to be bothered with questions posed by Senators when you are up for confirmation as Treasury Secretary. You especially don't have to answer questions about unusual bonuses you have received and accounts you have overseas at notorious tax havens. Why the gall of these Senators.

AccountingToday reports:
The Senate has confirmed Jacob Lew as the next Secretary of the Treasury, succeeding Timothy Geithner.[...]

Several senators were critical of Lew and 26 voted against his confirmation, including Sen. Charles Grassley, R-Iowa, ranking member of the Senate Judiciary Committee and former chairman of the Senate Finance Committee, who had questioned Lew during his confirmation hearings.

“Mr. President, the problem we face with Mr. Lew’s nomination is that the Senate does not have answers to basic factual questions about Mr. Lew,” he said in a speech on the Senate floor Wednesday. “How can we make an informed choice on his nomination? For example, when Mr. Lew worked at tax-exempt New York University, he was given a subsidized $1.4 million mortgage. Now, Mr. Lew claims that he cannot remember the interest rate he paid on his $1.4 million mortgage that tax-exempt New York University gave him. Does this pass the laugh test? I asked Mr. Lew to provide details of the mortgage to Congress. He refused repeated requests for full details and documentation of this taxpayer-subsidized mortgage. The explanations he did provide were needlessly complex, making it almost impossible to understand the structure of his loan. What is he hiding? Why can’t Congress get a straight answer out of him? When Mr. Lew was executive vice president of NYU, the school received kickbacks on student loans from Citigroup. Then, Mr. Lew went to work for Citigroup. When I asked Mr. Lew if he had any conversations with Citigroup about these kickbacks while he was at NYU, he once again ‘could not recall.’ I asked for any documents related to his involvement in the kickbacks. He refused to search for them. Did those conversations occur? We don’t know. On Monday, The New York Times uncovered a $685,000 payment NYU gave Jack Lew on his way out the door. The New York Times called the payment ‘unusual.’ It’s a shame that Mr. Lew failed to provide these details as part of his confirmation process, leaving us to rely on the press to dig out the details. He told the Finance Committee that he received ‘severance pay’ from NYU but did not disclose the amount. The dictionary defines ‘severance pay’ as, ‘A sum of money usually based on length of employment for which an employee is eligible upon termination.’ Was Mr. Lew terminated? If so, why was he terminated? If not, was the severance package really a parting gift from the university? I don’t know the answers to those questions, because Mr. Lew was not forthcoming with answers.

"When it comes to questions about investments in the Cayman Islands, things get even less transparent," Grassley added. "Mr. Lew claims he did not know that Ugland House was a notorious tax haven. He claims he did not know that he had his money in the Cayman Islands. He claims he was not aware of any Citigroup Cayman Islands accounts. Again, it doesn’t pass the laugh test. President Obama and Chairman Baucus had highlighted Ugland House as a problem. When Mr. Lew was at Citigroup, for years, he signed documents that disclosed the fact that he was investing money in the Cayman Islands. His distinctive signature was just inches away from the words ‘Ugland House,’ ‘Grand Cayman’ and ‘Cayman Islands.’ He claims now that he did not know where his money was going.  We have so many more questions for Mr. Lew. 
(ht Bill Bergman)

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