Fed Paid Too Much In AIG Bailout: Report

By Elaine Meyer

Law360, New York (November 17, 2009, 1:29 PM ET) -- The Federal Reserve Bank of New York failed to use its “considerable leverage” in negotiations in fall 2008 to reduce the amount of money it spent to help American International Group Inc. stay alive, according to a report assessing the U.S. government's involvement in the bailout.

Authored by Neil Barofsky, inspector general of the Troubled Asset Relief Program, the report offered sharp criticism of the Fed for paying the full value of AIG's credit default obligations to the eight largest counterparties — Societe Generale Group, Goldman...
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