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Congressional Republicans Calling For Investigation Into ShoreBank Bailout

Tyler Durden's picture





 

Yesterday we pointed out how insolvent South Chicago bank ShoreBank was rescued in the last minute by a consortium of banks led by Goldman Sachs, after early unwillingness to provide rescue funding to the bank was overcome once the President allegedly got involved. Today we learn from Fox Biz' Charlie Gasparino that congressional republicans, led by Spencer Bachus, are calling for an investigation into what could turn out to be another crooked scam to bail out an administration darling, because GM and Chrysler were not enough, even as over 70 banks have failed year to date, which however do not have the privilege of being in the president's very good graces.

Some excerpts from Gasparino:

On Bachus calling for an investigation into the Shorebank bailout:
“The congressional republicans are now going to call for an investigation into the bailout of Shorebank. As you know all these private sector banks came in at the last minute and threw in about $150 million. GE Capital, not exactly a bank, gave $20 million as well. Mr. Bachus thinks it’s suspicious so he is calling for an investigation.”

On why Bachus is targeting Shorebank:
“These are all banks that received substantial federal money. And he’s looking for why they are doing it [bailing out Shorebank].”

On when the investigation will happen:

“He’s [Bachus] writing the letter to the President today.”

On the White House’s stance:
“They’ve denied any political pressure.”

On the political pressure to bailout Shorebank:
“They [the banks] did tell me that they wouldn’t have given money to the banks unless there was some sort of political overtone. There was no reason to bail this out other than its connections.”

 


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Wed, 05/19/2010 - 12:31 | Link to Comment doublethink
Wed, 05/19/2010 - 12:39 | Link to Comment koaj
koaj's picture

none of them are capitalists...all cronies

Wed, 05/19/2010 - 12:40 | Link to Comment Mitchman
Mitchman's picture

Great post.  Thanks!

Wed, 05/19/2010 - 12:31 | Link to Comment Turd Ferguson
Turd Ferguson's picture

In the 80s we had The Keating Five.

Will this be The ShoreBank One?

Wed, 05/19/2010 - 14:40 | Link to Comment Problem Is
Problem Is's picture

Keating's Biggest Enabler?

The Felonious Criminal Milken and Drexel:

"In 1983, Milken's Drexel underwrote a $125 million debt-offering for Keating's American Continental Corporation..."

"Drexel underwrote a $56 million preferred stock issue of ACC. Keating took $51 million of the money and bought Lincoln."

"In other words, Drexel bought Lincoln for Keating. Drexel also secretly purchased a substantial hunk of the thrift for itself."

"Keating set about purchasing $2.7 billion in junk bonds, almost all of them (or at least the ones that regulators later inspected) from Drexel."

Where do you think the "Wall Street Stuffing Fannie & Freddie with MBS Junk" Idea Came From?

The same old play book... "Hey boys, dust of the Milken fraud for one more go..."

Philanthropist my ass... "I'm Bernie Madoff. I'm a philanthropist. I'm telling you right here! Trust me!"

Wed, 05/19/2010 - 12:32 | Link to Comment JohnKing
JohnKing's picture

More bananas please.

Wed, 05/19/2010 - 12:47 | Link to Comment etrader
etrader's picture

Speaking of which,

Have to say MCC(s) looks well in fuschia pink.

The CNBC anchorettes are making a real effort due a certain Aussie.

Wed, 05/19/2010 - 12:52 | Link to Comment Turd Ferguson
Turd Ferguson's picture

Mmmm....Mandy...:)

Wed, 05/19/2010 - 13:04 | Link to Comment John Self
John Self's picture

Mmm... Rupert.

Wed, 05/19/2010 - 13:01 | Link to Comment Rick64
Rick64's picture

and kool-aid don't forget the kool-aide.

Wed, 05/19/2010 - 12:33 | Link to Comment Raymond K Hassel
Raymond K Hassel's picture

Ya think there might be some loans on those books that don't need the scrutiny of a FDIC closure?

Wed, 05/19/2010 - 12:34 | Link to Comment BlackBeard
BlackBeard's picture

OH SNAP! I just got an erection.  This shit is going to be JUICY!

Paging Oliver Stone: "W" was kind of meh, in comparison to J.F.K and Nixon, but when Barry O's "1" term is over, I think you might have some material to work with!

Wed, 05/19/2010 - 12:37 | Link to Comment zerosum
zerosum's picture

Oh, of course they're on this like stink on shit; it will provide cover for their continuing effort to derail ANY effective banking regulation. Bunch of hypocritical brats.

Wed, 05/19/2010 - 13:08 | Link to Comment John Self
John Self's picture

Please point me to the "effective banking regulation" that is to be derailed.

Wed, 05/19/2010 - 12:37 | Link to Comment RottingDollar
RottingDollar's picture

I say we hire Neil Bush of Silverado fame to do the investigation.   He'll have the best perspective.

Wed, 05/19/2010 - 12:38 | Link to Comment wallstreetnobody
wallstreetnobody's picture

You have to love how Congressional Republicans jump on this issue of a tiny community bank while at the same time repeatedly preventing things like the Volker Rule to even come to a vote.  Thank you GOP for wrecking this country and preventing any hope for it.  Effing morons.

Wed, 05/19/2010 - 16:26 | Link to Comment Bear
Bear's picture

I'm sorry wallstreetnobody ... who is an Effing Moron?

Wasn't it Bill Clinton who signed the repeal of the Glass-Siegle Act?

Wed, 05/19/2010 - 12:40 | Link to Comment Pimp Juice
Pimp Juice's picture

Racists! (sarcasm off)

Wed, 05/19/2010 - 12:43 | Link to Comment lizzy36
lizzy36's picture

hmmm.......these wouldn't be members of the same republican party who are sucking the cream out of the c***s of WS banks, in exchange for ensuring that any substantial financial regulation never sees the light of day (see fed audit vote and last nights debate on Merkley-Levin amendment)?

 

Wed, 05/19/2010 - 14:46 | Link to Comment Problem Is
Problem Is's picture

"these wouldn't be members of the same republican party who are sucking the cream out of the c***s of WS banks..."

Yes lizzy... that would be them.

Didn't You Ever Read Mad Magazine?
Spy vs. Spy?
Well this is Ho' vs. Ho'...

Young lady... did you just say c***s the "CSuckers" word?

Wed, 05/19/2010 - 12:45 | Link to Comment koaj
Wed, 05/19/2010 - 12:45 | Link to Comment PulpCutter
PulpCutter's picture

This is like Martha Stewart serving jail time, while Blankfein, Geithner, etc. still walk around.

Hey GOP, surprised you could get your nose out of GS's butt long enough to notice SouthShore...

Wed, 05/19/2010 - 12:46 | Link to Comment Psquared
Psquared's picture

There is so much crooked shit going on it is impossible to keep up with. I am telling you, we are slowly being de-sensitized to all of this and soon we will not even react.

Wed, 05/19/2010 - 12:46 | Link to Comment pan-the-ist
pan-the-ist's picture

What if.. Goldman helped out the bank to make Obama look bad.  It would be ridiculously difficult to prove they did, and Obama would start sounding like Blagojevich if he denied it.

Obama better come out and say F***in' a' right I had Goldman bail out ShoreBank.  Blankfein is going to polish my shoes next!

Wed, 05/19/2010 - 13:33 | Link to Comment Apostate
Apostate's picture

That'd be hilarious.

I mean, Obama just buddy-fucked them. The liberals as well as the conservatives are yelling about Bob Rubin.

Rubin's basically the Zeus of Goldman Sachs (can't be too popular among the rank and file, though). If they're trying to "distance" themselves from Obama, GS may as well bring down the government with them like a crazed animal. 

Wed, 05/19/2010 - 12:48 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

Silly rabbit. All these banks defied statistical impossibility and arrived at precisely the same conclusion at precisely the same time, that it was a really really good idea to bail out.....er....invest in ShoreBank.

There is no conspiracy. And based upon the mainstream media, there has never ever been a single conspiracy ever in the world since the one to kill Jesus Christ. And if you think otherwise, you must be a conspiracy theorist.

Wed, 05/19/2010 - 12:56 | Link to Comment pan-the-ist
pan-the-ist's picture

The one to kill Jesus wasn't really a conspiracy either.  He choose martyrdom because he wanted to start a revolution, only it backfired 30 years later when the Romans burned down the great temple and crushed the Jewish uprising.  Read your Bible.

Wed, 05/19/2010 - 13:07 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

Sorry, I forgot something.

<sarcasm on>

There, that's better.

Wed, 05/19/2010 - 12:54 | Link to Comment AllYourBaseAreB...
AllYourBaseAreBelongToUs's picture

Didn't you get the memo that we're now in the "Do as I say, not as I do!" phase of government?  Of course O'Blama didn't start it - he's just perfecting it.

Wed, 05/19/2010 - 12:58 | Link to Comment Fraud-Esq
Fraud-Esq's picture

pathetic distraction

Wed, 05/19/2010 - 12:59 | Link to Comment No One
No One's picture

So, let me get this right.. We investigate potential Administration influence for bailouts of $150M, yet we do not investigate for potential Administrator influence for bailouts in the billions and trillions.

I love Congress.

Wed, 05/19/2010 - 13:02 | Link to Comment LongShortSally
LongShortSally's picture

I don't even know where to begin.  The pot calling the kettle black doesn't even begin to describe it. Hubris and hypocrisy are dripping everywhere.  Not sure which is worse, the BS that was offered up by the banks as a rationale for "investing" in ShoreBank or the Republican investigation because Republicans are "shocked, shocked" that there could be such skullduggery.  Meanwhile the average American continues to get hosed at the hands of the power hungry, greedy bastards in both Congress and at the major banks.  

"But I don't want to go among mad people,' said Alice. 'Oh, you can't help that,' said the cat. 'We're all mad here.".....Lewis Carroll 

Wed, 05/19/2010 - 13:05 | Link to Comment chet
chet's picture

GOP, first take bank reform seriously, then cast stones.

Wed, 05/19/2010 - 14:00 | Link to Comment docj
docj's picture

Why should they?  Welcome to life in the congressional minority - when stones are all you have, casting them is all you do.  Worked pretty well for the other guys from 2003 until 2007.

Besides, you don't honestly think any serious banking/finance reform is going to get past Chris Dodd (D-FriendOfAngelo) and Barney Frank (D-FanFred), do you?

Wed, 05/19/2010 - 15:28 | Link to Comment mtguy
mtguy's picture

"Barney Frank (D-FanFred) "

I think Barney's frank was is Freddies Fannie, personally.

(sorry couldn't resist.)

Wed, 05/19/2010 - 13:06 | Link to Comment crzyhun
crzyhun's picture

This is an interesting story....back in the 80's this bank/item was quite the bank in giving loans to small bzn in the chi-town area-among other activites. It served an ok function. Fast forward- CRA, Freddi, Fannie, et. al., Mr Raines perfected the small loans to loans of any stripe/form and term, especially RE. This bank grew like mad...to today. A crown jewel turned to rust.

They should have stayed true to the school of thought, small is beautiful.  

Wed, 05/19/2010 - 13:08 | Link to Comment Rick64
Rick64's picture

Bandwagon is here ! All aboard.

Wed, 05/19/2010 - 13:24 | Link to Comment Fraud-Esq
Fraud-Esq's picture

Massive distraction. No one should take the bait.

It's embarrassingly small bait. 

Keep your eye on the ball ZH!

This isn't it.

Wed, 05/19/2010 - 13:25 | Link to Comment kdervin
kdervin's picture

I briefly had accounts there and they had the absolute worst retail service.  Couldn't keep their 4 (that's right - four) ATMs up and running, the lobby hours were nonexistent, and no online banking.

They are the pits.

Wed, 05/19/2010 - 13:40 | Link to Comment carbonmutant
carbonmutant's picture

Well if the GOP doesn't call for an investigation who else will?

Wed, 05/19/2010 - 14:29 | Link to Comment milbank
milbank's picture

This could really be dynamite for the Republicans against Obama and the Democrats going into the mid-terms.  Sure we know they are all the same but, Joe and Jane Sixpack still doesn't quite know what to think about what has happened over the last couple of years and which politicians/party are to blame (and they do want someone to blame so they can feel better about voting for "the other guy").  This is a simple situation that they can get their brains around and whether it be Obama or the Clintons who applied the pressure, it certainly will not look good for the Democrats. 

Wed, 05/19/2010 - 14:19 | Link to Comment Rusty_Shackleford
Rusty_Shackleford's picture

It's like watching the Sopranos, but with lower quality actors and more vulgar plot-lines. (or pro-wrestling.  I can't decide)

Wed, 05/19/2010 - 14:22 | Link to Comment P-K4
P-K4's picture

They need to quit whining and posturing. After failing to show any sign of a backbone on financial reform, they want to go after nickel and dime shit !  Gimme a break.

Wed, 05/19/2010 - 15:04 | Link to Comment Immanuel Cunt
Immanuel Cunt's picture

And a bailout with grinding teeth that was - err, we're 25m short. Yep, all of us. Yep.

Is that how GE got in with their 20m? Still 5m missing...

Wed, 05/19/2010 - 16:20 | Link to Comment Bear
Bear's picture

ShoreGate ... Obama has put Nixon to shame ... Where are Bernstein and Woodward ?

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