Federal Reserve Loses Bloomberg FOIA Lawsuit, Sensitive Disclosures Forthcoming

Just out from Bloomberg:

Aug. 24 (Bloomberg) -- The Federal Reserve must make
public reports about recipients of emergency loans from U.S.
taxpayers under programs created to address the financial
crisis, a federal judge ruled.

This is in relation to a lawsuit filed by Bloomberg LP against the Federal Reserve on November 7, 2008, in Southern District of New York (08-09595), in which Bloomberg sought material loan and collateral data in relation to emergency loans released by the Fed, and which were previously claimed to be non-FOIAble.

This is a large blow against the Fed and specifically against organizations using FOIA loopholes from providing critical information, particularly in cases involving trillions of taxpayer dollars bailing out huge, systematically and politically embedded financial organizations (which lately is pretty much all of them).

The conclusion from the order just issued by District Judge Loretta Preska is as follows:

The Board's Motion for Summary Judgment is DENIED, and Bloomberg's Motion for Summary Judgment is GRANTED. Specifically:

1. The Board shall produce forwith the Remaining Term Reports within five business days of the date hereof;

2. The Board shall search forthwith records at the FRBNY that constitute "Records of the Board" within the meaning of 12 C.F.R. # 231.2(i)(1); and

3. The parties shall confer following their review of the results of the search and inform the Court by letter no later than September 14, 2009 how they propose to proceed.

The beneficial outcome means that many more FOIA-based lawsuits against the Federal Reserve will now spring up, and with case law on their side, the outcomes of most will likely be on behalf of the plaintiffs. This could detour any short-circuit attempts by either Congress or Senate to prevent a Fed audit, as it may suddenly not be necessary, now that there is this alternative venue to get various pieces of information, previously not available to the general public.

Comments

[peoplesdemocrat...]

Sorry about that Benny boy!

[jdoo]

WSJ and digg.com just conducted an interview with Geithner where the top10 community submitted questions were asked.

Here's the link:  http://online.wsj.com/community/dialogg

And the questions which were asked:

• 1. Why has the federal reserve bank never been audited?
• 2. Goldman Sachs is a large, profit seeking company which you were/are a part of. Isn't it a conflict of interest to funnel tax dollars into this private company using your new power as Secretary of the Treasury, keeping in mind that you and your old buddies benefit monetarily? Maybe I'm mistaken, but isn't this a textbook example of political corruption?
• 3. What is your position on Ron Paul's House Resolution 1207? (Which as of the writing of this question has 282 cosponsors.) http://www.auditthefed.com/
• 4. You failed to pay some of your federal taxes in 2001. And in 2002. And in 2003. And in 2004. Please explain.
• 5. How do you feel about the revolving door between high job positions in the treasury and Goldman Sachs?
• 6. Last week you requested that Congress raise the $12.1 trillion statutory debt limit, saying that it could be breached as early as mid-October. This is in addition to the increase already approved in February this year to accommodate the added debt from the $787 Billion stimulus plan. How is this anything other than runaway government spending? What will it take for us to see US debt go the other direction?
• 7. Why is the government only supporting aging and increasingly obsolete car makers? You've given an extraordinary amount of money to GM, but the government has failed to encourage new, innovative, and cleaner forms of personal transportation such as produced by Tesla Motors. Why has TARP money not been invested in companies such as Tesla, and will the government support similar companies in the future?
• 8. Are you, yourself, troubled by the massive amount of government spending? What do you think will happen to the dollar over the next 10 years?
• 9. You are a member of the Federal Reserve, a group that so thoroughly mismanaged our monetary policy that they helped create a massive housing bubble because of foolish loans and speculation enabled by low interest rates, and then you were involved in a horribly mismanaged bailout that hasn't freed up credit markets and can't even account for all the money it spent. Why are you running the Treasury Department?
• 10. You've amended your tax returns for the years 2001, 2002, 2004, 2005 and 2006 and found that you've owed an additional $31,536 http://finance.senate.gov/press/Bpress/2009press/prb011309d.pdf ... Giving you the benefit of a doubt (that you are neither inept nor corrupt but were simply overwhelmed by an overly complex system), what recommendations do you have for simplifying the tax code?

[Anonymous]

Why does the TBTF argument extend beyond supporting an institution? I would find the bailout actions much more credible if the shareholders and bond holders in the institutions led the way in paying for their mistakes.

Put the TBTF's into bankruptcy with the gubbermit providing DIP financing, take our lumps, prosecute the guilty, pass reforms to appropriately penalize future errant behavior, then get on with reconstructing retirement plans, etc.

On a different subject, we won an engagement when TPTB were forced to use the Bernanke reappointment asset to mitigate the damage from this decision. Our best hope is to keep attacking until their resources have been expended. As noted above, this will be a long, hard slog. So, let's spend a few minutes in celebratory glee, then get back to work digging through the muck.

I offer my sincere gratitude to those better positioned than me who are using their capabilities to save our country.

[Hondo]

Generals and the CIA even have public audit, even in times of war and the Federal Reserve thinks they are so special that they should have public audit???  This is a crime and everyone of the idiots at the Fed that voted not to disclose should be terminated how ever the public seems fit to do so.

[sun1]

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